In October, Temptations Event Planners (TEP) planned events for two clients. TEP worked 140 hours for Ward Corporation and 240 hours for Girardin Industries. TEP bills clients at the rate of $350 per hour; labor cost for its planning staff is $140 per hour. The total number of hours worked in October was 380, and overhead costs were $15,600. Overhead is applied to clients at $32 per planner- hour. In addition, TEP had $27,000 in marketing and administrative costs. All transactions are on account. All services were billed. Transaction (a) (b) (c) (d) Description Record labor cost Record applied service overhead Record cost of services billed Record actual service overhead Required: a. Show labor and overhead cost flows through T-accounts. b. Prepare an income statement for the company for October.

In October, Temptations Event Planners (TEP) planned events for two clients. TEP worked 140 hours for Ward Corporation and 240 hours for Girardin Industries. TEP bills clients at the rate of $350 per hour; labor cost for its planning staff is $140 per hour. The total number of hours worked in October was 380, and overhead costs were $15,600. Overhead is applied to clients at $32 per planner- hour. In addition, TEP had $27,000 in marketing and administrative costs. All transactions are on account. All services were billed. Transaction (a) (b) (c) (d) Description Record labor cost Record applied service overhead Record cost of services billed Record actual service overhead Required: a. Show labor and overhead cost flows through T-accounts. b. Prepare an income statement for the company for October.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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