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For August, Royal Consulting and Mediation Practice (RCMP) worked 700 hours for Alberta Company and 1,900 hours for Ontario Corporation. RCMP bills clients at the
For August, Royal Consulting and Mediation Practice (RCMP) worked 700 hours for Alberta Company and 1,900 hours for Ontario Corporation. RCMP bills clients at the rate of $410 per hour; labor cost for its consulting staff is $210 per hour. The total number of hours worked in August was 2,600, and overhead costs were $61,000. Overhead is applied to clients at $28 per labor-hour. In addition, RCMP had $245,000 in marketing and administrative costs. All transactions are on account. All services were billed. Transaction (a) (b) (c) (d) Description Record Labor cost Record Applied Service Overhead Record Cost of services billed Record Actual Service Overhead Required: a. Show labor and overhead cost flows through T-accounts. Wages Payable Work-In-Process Beg. bal. Beg. bal. End. bal. 0 End, bal Cost of Services Billed Service Overhead Control Beg. bal. Beg. bal. End. bal End, bal Applied Service O.H. Beg, bal End. bal. 0 b. Prepare an income statement for the company for August. ROYAL CONSULTING AND MEDIATION PRACTICE Income Statement For the Month Ended August 31
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