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Compute total job cost for the gargus account

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Reference no: EM132476131

The Meyers CPA firm has the following overhead budget for the year:

Overhead

Indirect materials                              $360,000

Indirect labor                                  1,690,000

Depreciation-Building                           305,000

Depreciation-Furniture                          37,000

Utilities                                             315,000

Insurance                                           40,000

Property taxes                                     54,000

Other expenses                                  147,000

Total                                             $2,948,000

  • The firm estimates total direct labor cost for the year to be $1,842,500. The firm uses direct labor cost as the cost driver to apply overhead to clients.

During January, the firm worked for many clients; data for two of them follow:

Gargus account

Direct labor                  $3,100

Feller account

Direct labor                  $9,100

Required:

Question 1. Compute the firm's predetermined overhead rate.

Question 2. Compute the amount of overhead to be charged to the Gargus and Feller accounts using the predetermined overhead rate calculated in requirement 1.

Question 3. Compute total job cost for the Gargus account and the Feller account.

Reference no: EM132476131

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