An accounting firm provides tax consulting for estates and trusts.Their job costing system has a single direct cost category (professional labour)and a single indirect cost pool (research support).The indirect cost pool contains all the costs except direct personnel costs.All budgeted indirect costs are allocated to individual jobs using actual professional labour hours.Required:
a.Discuss the reasons a consulting firm might use normal costing in its job system rather than actual costing.
b.What might be some ways for the firm to change from a one pool allocation concept?

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The Answer of An accounting firm provides tax consulting for estates and trusts.Their job costing system has a single direct cost category (professional labour)and a single indirect cost pool (research support).The indirect cost pool contains all the costs except direct personnel costs.All budgeted indirect costs are allocated to individual jobs using actual professional labour hours.Required:
a.Discuss the reasons a consulting firm might use normal costing in its job system rather than actual costing.
b.What might be some ways for the firm to change from a one pool allocation concept?

An Accounting Firm Provides Tax Consulting for Estates and Trusts