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Dove Design, Inc. is a Web site design and consulting firm. The firm At the beginning of 2018, managing partner Janie Ginger uses a job
Dove Design, Inc. is a Web site design and consulting firm. The firm At the beginning of 2018, managing partner Janie Ginger uses a job order costing system in which each client is a different job. prepared the following budget estimates: Dove Design assigns direct labor, licensing costs, and travel costs (Click the icon to view the prepared budget.) directly to each job. It allocates indirect costs to jobs based on a predetermined overhead allocation rate, computed as a percentage of In November 2018, Dove Design served several clients. direct labor costs. Records for two clients appear here: (Click the icon to view the records for two clients.) Read the requirements. Requirement 1. Compute Dove Design's direct labor rate and its predetermined overhead allocation rate for 2018. (Abbreviation used: OH = overhead.) Begin with the direct labor rate. = Direct labor rate per hour Compute Dove Design's predetermined overhead cost allocation rate for 2018. Predetermined OH cost allocation rate %Requirement 2. Compute the total cost of each job. First, enter the direct costs for each job. Then enter in the indirect costs and compute the total cost for each job. (Enter a "0" for any zero balances.) Dove Design, Inc. Estimated Cost of Food Place and Martin Chocolates Jobs Martin Food Place Chocolates Direct Costs:\fRequirement 3. If Ginger wants to earn profits equal to 20% of service revenue1 what fee should she charge each of these him clients? Feud Place $ :| Martin Chocolates $ :| Requirement 3. If Ginger wants to earn profits equal to 20% of service revenue, what fee should she charge each of these two clients? Food Place Martin Chocolates Requirement 4. Why does Dove Design assign costs to jobs? Dove Design assigns costs to jobs to help the company that cover all costs and contribute to profit. Assigning costs to also can help Dove Design control costs.1. Compute Dove Design's direct labor rate and its predetermined overhead allocation rate for 2018. 2. Compute the total cost of each job. 3. If Ginger wants to earn profits equal to 20% of service revenue, what fee should she charge each of these two clients? 4. Why does Dove Design assign costs to jobs?Direct labor hours (professionals) 10,000 hours Direct labor costs (professionals) $ 2,100,000 Support staff salaries 700,000 Computer leases 49,000 Office supplies 28,000 Office rent 63,000Food Place Martin Chocolates Direct labor hours 600 hours 500 hours Software licensing costs $ 5,000 $ 500 Travel costs 11,000 0
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