Financial and Managerial Accounting: P19-44 Recall that Daniels allocated indirect costs to jobs

Financial and Managerial Accounting 
P19-44 Comparing costs from ABC and single-rate systems 
This problem continues the Daniels Consulting situation from Problem P17-40 of Chapter 17. 
Recall that Daniels allocated indirect costs to jobs based on a predetermined overhead allocation rate, computed as a percentage of direct labor costs. Because Daniels provides a service, there are no direct materials costs. Daniels is now considering using an ABC system, information about ABC costs follows: 
Activity Budgeted Cost of Activity Allocation Base Predetermined Overhead Allocation Rate 
Designing 20,000 Number of designs 1,350 
Programming 50,000 Number of direct labor hours 25 
Testing 25,000 Number of tests 500 

Records for two clients appear here: 
Job Total Travel and Meal Costs Total Number of Designs Total Direct Labor Hours Total Number of Tests 
Tommy's Trains 10,700 3 720 6 
Marcia's Cookies 600 4 200 6 

Requirements 
1. Compute the total cost for each job. The cost of direct labor is S176 per hour. 
2. is the job cost greater or less than that computed in Problem P17-40 for each job? Why? 
3. If Daniels wants to earn an operating income equal to 25% of the total cost, how much (what fee) should it charge each of these two clients? 
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