Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

TechMaster is an information technology (IT) consulting company offering services to small firms. TechMaster bills clients for its various services based on the hours its

TechMaster is an information technology (IT) consulting company offering services to small firms. TechMaster bills clients for its various services based on the hours its professionals spend. In August, IT professionals billed 885 hours to clients and worked a total of 940 hours (the difference includes time for training, preparing bids, and so on, which are considered administrative costs). TechMaster bills clients at the rate of $220 per hour; labor cost for its IT professionals is $85 per hour. Overhead costs in August totaled $37,000. Overhead is applied to clients at $47 per labor-hour. In addition, TechMaster had $57,000 in marketing and administrative costs (including labor time as described above). All transactions are on account. All services were billed. Transaction Description (a) Record Labor cost (b) Record Applied Service Overhead (c) Record Cost of services billed (d) Record Actual Service Overhead Required: a. Show labor and overhead cost flows through T-accounts. b. Prepare an income statement for the company for August.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Auditing Humor And Other Oxymorons

Authors: Mr Mike Jacka

1st Edition

0991280903, 978-0991280902

More Books

Students also viewed these Accounting questions

Question

If {Y (t), t 0} is a Martingale, show that E[Y (t)] = E[Y (0)]

Answered: 1 week ago

Question

Write formal proposal requests.

Answered: 1 week ago

Question

Write an effective news release.

Answered: 1 week ago

Question

Identify the different types of proposals.

Answered: 1 week ago