To determine the total cost of completed Job 101, we need to calculate the costs for each department and add them up.

Hoffman Consulting computes the cost of each consulting engagement by adding a portion of firmwide overhead costs to the labor cost of the consultants on the engagement. The overhead costs are assigned to each consulting engagement using a cost driver rate based on consultant labor costs.

Hoffman Consulting's overhead costs are $9.6 million per year, and total consultant labor cost is estimated at $2.4million per year.

Requirements

(a)	What is Hoffman Consulting's cost driver rate?
(b)	If the consultant labor cost on an engagement is $24,000, what cost will Hoffman Consulting compute as the total cost of the consulting engagement?

Requirement (a) What is Hoffman Consulting's cost driver rate?

The cost driver rate is $ .................. for each ....................................

a) $1 of consultant labor costs.

b) customer.

c) specialized job.

Requirement (b) If the consultant labor cost on an engagement is $24,000,

what cost will Hoffman Consulting compute as the total cost of the consulting engagement?

The total cost of the consulting engagement is ..........................