324) The predetermined indirect cost allocation rate computed as
A) total : 1876938
324) The predetermined indirect cost allocation rate is computed as
A) total estimated indirect costs / total estimated amount of the allocation base.
B) total amount of the allocation base / total estimated indirect costs.
C) total estimated indirect costs + total estimated amount of the allocation base.
D) total amount of the allocation base - total estimated indirect costs.
325) The most significant cost for a service company is
B) manufacturing overhead.
D) indirect costs.
326) When job costing is used at a service firm
A) indirect costs are traced to client jobs.
B) direct costs are allocated to client jobs.
C) indirect costs are allocated to client jobs.
D) all costs are allocated to client jobs.
327) When job costing is used at a service firm, the bill to the client shows
A) the billing rate and hours spent on the job.
B) the allocation of indirect costs.
C) the profit on the job.
D) actual direct cost of providing the service.
328) The ________ is the hourly price charged to clients for professional labor.
A) salary rate
B) billing rate
C) wage rate
D) job rate
329) The journal entries needed for job costing at a service company
A) are more complicated than those needed at a manufacturing company.
B) are virtually the same as those needed at a manufacturing company.
C) include the movement of inventory.
D) are simpler than those needed at a manufacturing company.
330) Service firms develop a predetermined rate for some costs. This rate is called the
A) labor rate.
B) direct cost rate.
C) indirect cost allocation rate.
D) hourly cost rate.
331) A graphic designer spends 35 hours working with client #130 during May. Her basic annual salary is $61,440, while her annual salary plus benefits totals $80,640 per year. She typically works 40 hours a week for 48 weeks each year. What is the hourly cost to the firm that employs her?
332) Earnst & Earnst Consulting pays Amber Kelly $58,000 per year. The cost of her annual benefits is $17,000. Kelly works 2,500 hours per year.
A. What is the hourly rate to Earnst & Earnst Consulting of employing Amber Kelly?
B. If Amber works 30 hours for client 252, what is the direct labor cost associated with that client?
333) Tina's Interior Design expects its designers will work a total of 14,000 direct labor hours during the upcoming year. Tina's estimated total indirect costs are $168,000. The indirect cost allocation rate is based on direct labor hours.
A. What is the indirect cost allocation rate?
B. What indirect costs will be allocated to client 332, if one designer works 25 hours?
334) The law firm of Lyons & Lyons uses a job costing system to accumulate client-related costs. The indirect cost allocation rate is 80% of direct labor cost. Staff time is charged at a rate of $65 per labor hour. A recent job for a client involved 30 staff labor hours by staff lawyers.
Compute the cost of the job.