Company is a management consulting firm. The company expects to incur $212,000 of indirect costs this year. Indirect costs are allocated based on the following activities:

Data table

Activity	Estimated Cost	Allocation Base	Estimated Quantity of Allocation Base	Predetermined Overhead Allocation Rate
Site visits	$104,000	Number of visits	1,300 visits	$80 per visit
Documentation preparation	108,000	Number of pages	3,600 pages	$30 per page
Total indirect costs	$212,000

More info

Colston bills clients at 120% of the direct labor costs. The company has estimated direct labor costs at $290 per hour. Last month, Colston completed a consulting job for Client 76 and used the following resources:

Allocation Base	Client 76
Direct labor hours	70
Visits	14
Pages	35

Determine the total cost of the consulting job and the operating income earned.

Question content area bottom

Part 1

Begin by selecting the formula to compute the allocated overhead (OH) cost.

						Allocated
					=	overhead costs