P20-6A OneClick is a Web site design and consulting firm. The firm uses a job cost system,

Question:

P20-6A OneClick is a Web site design and consulting firm. The firm uses a job cost system, where each client is a different "job." OneClick traces direct labor, licensing costs, and travel costs directly to each job (client). It allocates indirect costs to jobs based on a predetermined indirect cost allocation rate, computed as a percentage of direct labor costs. At the beginning of 20X4. managing partner Lauren Pearle prepared the following budget: Direct labor hours (professional). Direct labor costs (professional) Support staff salaries Computer leases. Office supplies Office rent 6,000 hours $600,000 70.000 34,000 11,000 35,000 In November 20X4. OneClick served several clients. Records for two clients appear here: Planet Foods Deception Fragrances Direct labor hours. 675 hours 20 Hours Licensing costs $ 1,325 $125 Travel costs. $10,500 Required 1. Compute OneClick's predetermined indirect cost allocation rate for 20X4. 2. Compute the total cost of each job. 3. If Pearle wants to earn profits equal to 30% of sales revenue, how much (what total fee) should she charge each of these two clients? 4. Why does OneClick assign costs to jobs?

Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For  book-img-for-question

Accounting

ISBN: 9780130906991

5th Edition

Authors: Charles T. Horngren, Walter T. Harrison, Linda S. Bamber, Betsy Willis, Becky Jones

Question Posted: