Exercise 4-16 Lasso and Markowitz is a law firm that is initiating an activity-b
ID: 2408171 • Letter: E
Question
Exercise 4-16 Lasso and Markowitz is a law firm that is initiating an activity-based costing system. Sam Lasso, the senior partner and strong supporter of ABC, has prepared the following list of activities performed by a typical attorney in a day at the firm Classify each of the activities listed by Sam Lasso as value-added or non-value added Activities Writing contracts and letters Attending staff meetings Taking depositions Doing unique research Traveling to/from court Contemplating legal strategy Eating lunch Litigating a case in court Entertaining a prospective client Hours 1.5 0.5 1.0 1.0 1.0 1.0 1.0 2.5 1.5 How much was value-added time? (Round answer to 1 decimal place, e.g. 2.1.) Value-added time hours How much was non-value-added time? (Round answer to 1 decimal place, e.g. 2.1.) Non-value-added hoursExplanation / Answer
Activities
Hours
Writing contracts and letters
1.5
Value -added
Attending staff meetings
0.5
Non – value - added
Taking depositions
1.0
Value -added
Doing research
1.0
Non – value - added
Traveling to/from court
1.0
Non – value - added
Contemplating legal strategy
1.0
Value -added
Eating lunch
1.0
Non – value - added
Litigating a case in court
2.5
Value -added
Entertaining a prospective client
1.5
Non – value - added
Value – added time
6 Hours
Non - value – added time
5 Hours
Activities
Hours
Writing contracts and letters
1.5
Value -added
Attending staff meetings
0.5
Non – value - added
Taking depositions
1.0
Value -added
Doing research
1.0
Non – value - added
Traveling to/from court
1.0
Non – value - added
Contemplating legal strategy
1.0
Value -added
Eating lunch
1.0
Non – value - added
Litigating a case in court
2.5
Value -added
Entertaining a prospective client
1.5
Non – value - added
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