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Mackenzie Consulting computes the cost of each consultingengagement by adding a portion of firmwide support costs to thelabor cost of the consults on the engagement.
Mackenzie Consulting computes the cost of each consultingengagement by adding a portion of firmwide support costs to thelabor cost of the consults on the engagement. The support costs areassigned to each consulting engagement using a cost driver ratebased on consultant labor costs. Mackenzie Consultingssupport costs are $5 million per year, and total consultant laborcost is estimated at $2.5 million per year.
a. What is MackenzieConsultings support cost driver rate?
b. If the consultant labor coston an engagement is $25,000, what cost will Mackenzie Consultingcompute as the total cost of the consulting engagementStep by Step Solution
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