Skylark Design is an interior design firm. The firm uses a job cost system in which each client is a different? "job." Skylark Design traces direct? labor, licensing? costs, and travel costs directly to each job? (client). It allocates indirect costs to jobs based on a predetermined indirect cost allocation rate computed as a percentage of direct labor costs.

Direct labor hours (professional) . . . . . . . 10,000 hours Direct labor costs (professional) . . . . . . . $ 1,300,000 Support staff salaries . . . . . . . . . . . . . . . . $ 160,000 Computer lease payments. . . . . . . . . . . . $ 48,000 Office supplies . . . . . . . . . . . . . . . . . . . . . $ 28,000 Office rent. . . . . . . . . . . . . . . . . . . . . . . . . $ 63,000

Food Coop GoGreen.com Direct labor hours . . . . . . . . . . 730 hours 35 hours Licensing costs . . . . . . . . . . . . $ 2,500 $ 150 Travel costs . . . . . . . . . . . . . . . $ 6,000 $ 0

1.Compute

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?Design's predetermined indirect cost allocation rate for the current year?

2. Compute the total cost for each job?

3. If Judi wants to earn profits up to %50 of service revenue, what fee should she charge of each of these 2 clients?

4. Why does Skylark Design assign cost to jobs?