EXERCISE 3-6 Job-Order Costing for a Service Company L03-1, L03-2, L03-3 Tech Solutions is a consulting firm that uses a job-order costing system. Its direct materials consist of hardware and software that it purchases and installs on behalf of its clients. The firm's direct labor includes salaries of consultants that work at the client's job site, and its overhead consists of costs such as depreciation, utilities, and insurance related to the office headquarters as well as the office supplies that are consumed serving clients. Isto Tech Solutions computes its predetermined overhead rate annually on the basis of direct labor-hours. At the beginning of the year, it estimated that 80,000 direct labor-hours would be required for the period's estimated level of client service. The company also estimated $680,000 of fixed overhead cost for the coming period and variable overhead of $0.50 per direct labor-hour. The firm's actual overhead cost for the year was $692,000 and its actual total direct labor was 83,000 hours. Required: Jabonabido 19 agnie adeo ubis 1. Compute the predetermined overhead rate. 2. During the year, Tech Solutions started and completed the Xavier Company engagement. The following information was available with respect to this job: 00 Direct materials. Direct labor cost Direct labor-hours worked. Compute the total job cost for the Xavier Company engagement. $38,000 $21,000 280 dW

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EXERCISE 3-6 Job-Order Costing for a Service Company L03-1, L03-2, L03-3
ivitos batemi
Tech Solutions is a consulting firm that uses a job-order costing system. Its direct materials consist
of hardware and software that it purchases and installs on behalf of its clients. The firm's direct
labor includes salaries of consultants that work at the client's job site, and its overhead consists of
costs such as depreciation, utilities, and insurance related to the office headquarters as well as the
office supplies that are consumed serving clients.
IstorTech Solutions computes its predetermined overhead rate annually on the basis of direct
labor-hours. At the beginning of the year, it estimated that 80,000 direct labor-hours would be
required for the period's estimated level of client service. The company also estimated $680,000
of fixed overhead cost for the coming period and variable overhead of $0.50 per direct labor-hour.
The firm's actual overhead cost for the year was $692,000 and its actual total direct labor was
83,000 hours.
Required: labin.
1. Compute the predetermined overhead rate.
2.
During the year, Tech Solutions started and completed the Xavier Company engagement. The
following information was available with respect to this job: 00
Direct materials
Direct labor cost
Direct labor-hours worked..
Compute the total job cost for the Xavier Company engagement.
$38,000
$21,000
280
Lalai2noo 002 Adol
Transcribed Image Text:● EXERCISE 3-6 Job-Order Costing for a Service Company L03-1, L03-2, L03-3 ivitos batemi Tech Solutions is a consulting firm that uses a job-order costing system. Its direct materials consist of hardware and software that it purchases and installs on behalf of its clients. The firm's direct labor includes salaries of consultants that work at the client's job site, and its overhead consists of costs such as depreciation, utilities, and insurance related to the office headquarters as well as the office supplies that are consumed serving clients. IstorTech Solutions computes its predetermined overhead rate annually on the basis of direct labor-hours. At the beginning of the year, it estimated that 80,000 direct labor-hours would be required for the period's estimated level of client service. The company also estimated $680,000 of fixed overhead cost for the coming period and variable overhead of $0.50 per direct labor-hour. The firm's actual overhead cost for the year was $692,000 and its actual total direct labor was 83,000 hours. Required: labin. 1. Compute the predetermined overhead rate. 2. During the year, Tech Solutions started and completed the Xavier Company engagement. The following information was available with respect to this job: 00 Direct materials Direct labor cost Direct labor-hours worked.. Compute the total job cost for the Xavier Company engagement. $38,000 $21,000 280 Lalai2noo 002 Adol
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