Answer:-

(a) Actual costing

Under Actual costing method, all the actual amount incurred i.e actual labour cost, actual material cost and actual overhead incurred would be considered.

Indirect costs are those costs incurred by the entity which is not directly related to production or any service. we cannot compare the indirect cost vis a vis production. These costs incurred in supportive in nature to facilitate the production or service.

Indirect cost per professional labour hour is as follows :- (Under Actual cost method)

Indirect Cost per professional labour hour = Actual support cost / Actual total professional hours

= $ 2,400,000 / 23,300

=$ 103

(b) Normal Costing

Under Normal costing, predetermeined over head rate is estimated and same can be used to assigh the overhead to products or services. In other words, the overhead rate under normal costing is based on the expected overhead cost and expected machine hours or man hours or other suitable cost driver.

In the given case, we need to calculate the expected professional labour hours

Expected Professional labour hours = 8 Partners x 2, 650 hours

= 21,200 hours

Budgeted support costs = $ 2,000,000

Indirect cost per professional labour hour is as follows :- (Under Normal cost method)

Indirect Cost per professional labour hour = Budgeted support cost / Expected total professional hours

= $ 2,000,000/ 21,200

= $ 94.34.