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Variance

Item Hours Billing Rate Total Cost
Attorney hours
planning and
court time 150 $185/hr 27750

Admin. and
clerical support 60 $75/hr 4500
Witness fees n/a n/a 1500
court costs n/a n/a 500

Total $34250

At the end of the trial, Perry provided Todd with a bill totaling $42,840. the following billing details were also provided:

Item Hours Total Cost
Attorney hours 187 34595
Admin and clerical
support 52 3640
Witness fee n/a 2750
Deposition fees 1255
court costs n/a 600

Total $42840

Perry offered the following explanations for the difference between the estimaed and final billings.

1. Continuances and unforeseen issues resulted in the extra attorney hours
2. Deposition fees were not anticipated in the original quote
3. Although the number of filings was exactly as anticipated, Perry was not aware that the court had increase its filing fees, resulting in an extra $100.

A. Calculate teh average rate per hour that Todd was billed for attorney time and clerical assistance.
B. Based on the original budge estimate, was the labor efficiency variance for attorney time favorable or unfavorable?
C. Is the court filing fee variance related to volume? Explain.
D. Calculate teh labor rate, efficiency, and total variances associated with clerical support.

Solution Summary

The solution explains the calculation of various variances

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