More info Durgin Inc. is a technology consulting firm focused on website development and integration of internet business applications. President Civilla Post's ear is ringing after an unpleasant call from client John Yancy. Yancy was irate after opening his bill for Durgin's redesign of his company's website. Yancy said that Durgin's major competitor, Beta Systems, charged much lower fees to another company for which Yancy serves on the board of directors. Post is puzzled for two reasons. First, she is confident that her firm knows website design and support as well as any of Durgin's competitors. Post cannot understand how Beta Systems can undercut Durgin's rates and still make a profit. But Beta Systems is reputed to be very profitable. Second, just yesterday Post received a call from client Robert Cordaro. Cordaro was happy with the excellent service and reasonable fees Post charged him for adding a database-driven job-posting feature to his company's website. Post was surprised by Cordaro's compliments because this was an unusual job for Durgin that required development of complex database management and control applications, and she had felt a little uneasy accepting it. Like most consulting firms, Durgin traces direct labour to individual Print Done understand how Beta Systems can undercut Durgin's rates and still make a profit. But Beta Systems is reputed to be very profitable. Second, just yesterday Post received a call from client Robert Cordaro. Cordaro was happy with the excellent service and reasonable fees Post charged him for adding a database-driven job-posting feature to his company's website. Post was surprised by Cordaro's compliments because this was an unusual job for Durgin that required development of complex database management and control applications, and she had felt a little uneasy accepting it. Like most consulting firms, Durgin traces direct labour to individual engagements (jobs). Durgin allocated indirect costs to engagements using a budgeted rate based on direct labour hours. Post is happy with this system, which she has used since she established Durgin in 1995. Post expects to incur $716,000 of indirect costs this year, and she expects her firm to work 5,900 direct labour hours. Post and the other systems consultants earn $385 per hour. Clients are billed at 165% of direct labour cost. Last month, Durgin's consultants spent 125 hours on Yancy's engagement. They also spent 125 hours on Cordaro's engagement. Information relating to Durgin Inc follows: (Click the icon to view the company's information.) 1. Compute Durgin's indirect cost allocation rate 2. Compute the total costs assigned to the Yancy and Cordaro engagements 3. Compute the operating income from the Yancy and Cordaro engagements. Requirement 1. Compute Durgin's indirect cost allocation rate. First identify the formula used to compute the indirect cost alocation rate, then compute the rate. (Round your answer to two decimal places.) Estimated total indirect costs 716000 Estimated direct labour hours 5900 Indirect cost allocation rate (per hi) 246.90 Requirement 2. Compute the total costs assigned to the Yancy and Cordaro engagements. (Round your answers to the nearest whole dollar.) Direct labour Yancy Cordaro Requirement 2. Compute the total costs assigned to the Yancy and Cordaro engagements. (Round your answers to the nearest whole dollar.) Direct labour Indirect costs Yancy Cordaro Total costs Requirement 3. Compute the operating income from the Yancy and Cordaro engagements. (Round your answers to the nearest whole dollar.) Service revenue Less: Operating income Yancy Cordaro Time Remaining