Computing overhead rate; setting price quoteservice company

A1

Sofa Gomez runs a mobile pet grooming service. She charges $35 direct labor per grooming hour. She applies overhead to jobs on the basis of grooming hours. She predicts 800 grooming hours for the year. Her estimated overhead costs for the year follow.

1. Compute the predetermined overhead rate using estimated grooming hours.

2. Sofa has been asked to groom three large dogs. She expects this job to require a total of 12 direct labor grooming hours. Compute her total cost (direct labor plus applied overhead) for this job.

3. If Sofa targets a markup of 25% on the total cost for each job, what price should she quote for the job in part 2?