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Kendrick Consulting is a consulting firm. The firm expects to have $52,800 in indirect costs during the year and bill customers for 7,200 hours. The cost of direct labor is $72 per hour. 1. Calculate the predetermined overhead allocation rate for Kendrick Consulting. 2.Kendrick completed a consulting job for Peter Johnson and billed the customer for 16 hours. What was the total cost of the consulting? 3.If Kendrick wants to earn a profit equal to 75% of the cost of a job, how much should the company charge Mr. Johnson?

Kendrick Consulting is a consulting firm. The firm expects to have $52,800 in indirect costs during the year and bill customers for 7,200 hours. The cost of direct labor is $72 per hour. 1. Calculate the predetermined overhead allocation rate for Kendrick Consulting. 2.Kendrick completed a consulting job for Peter Johnson and billed the customer for 16 hours. What was the total cost of the consulting? 3.If Kendrick wants to earn a profit equal to 75% of the cost of a job, how much should the company charge Mr. Johnson?

FINANCIAL ACCOUNTING
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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How much should the company charge mr.johnson?

Kendrick Consulting is a consulting firm. The firm expects to have $52,800 in indirect costs during the year and bill customers for 7,200 hours. The cost of direct labor is $72 per hour. 1. Calculate the predetermined overhead allocation rate for Kendrick Consulting. 2.Kendrick completed a consulting job for Peter Johnson and billed the customer for 16 hours. What was the total cost of the consulting? 3.If Kendrick wants to earn a profit equal to 75% of the cost of a job, how much should the company charge Mr. Johnson?
Transcribed Image Text:Kendrick Consulting is a consulting firm. The firm expects to have $52,800 in indirect costs during the year and bill customers for 7,200 hours. The cost of direct labor is $72 per hour. 1. Calculate the predetermined overhead allocation rate for Kendrick Consulting. 2.Kendrick completed a consulting job for Peter Johnson and billed the customer for 16 hours. What was the total cost of the consulting? 3.If Kendrick wants to earn a profit equal to 75% of the cost of a job, how much should the company charge Mr. Johnson?
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