Question
possib Eisenhower Services, Inc., a management consulting firm, has been using a single predetermined overhead allocation rate with direct labor hours as the allocation
possib Eisenhower Services, Inc., a management consulting firm, has been using a single predetermined overhead allocation rate with direct labor hours as the allocation base to allocate overhead costs. The president of Eisenhower decided to develop an ABC system to more accurately allocate the indirect costs. She identified two activities related to the total indirect costs-travel and information technology (IT) support. The other relevant details are given below Estimated quantity of allocation Activity Travel IT Support Total Allocation base Miles driven Direct labor hours Estimated costs $10,600 77,000 $87,600 base 1,300 miles 7,000 DLHr During the current month, Eisenhower's consultants spent 260 labor hours for Miller, Inc. The job required the professionals to travel 360 miles in total. Direct Labor is billed at $75 per hour. Determine the total cost of the consulting iob usina the ABC svstem. (Round anv intermediate calculations to the nearest cent and your final answer to the OA. $19,500 OB. $25,294 OC. $5,794 OD. $22,360
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