Queenston Professional Support (QPS) provides professional services (IT, payroll and billing, and so on) to firms requiring temporary help in those areas. QPS bills clients for its various services based on the hours its professionals spend. In January, QPS professionals billed 1,925 hours to clients and worked a total of 2,020 hours. (The difference includes time for training, preparing bids, and so on, which are considered administrative costs.) QPS bills clients at the rate of $365 per hour; labor cost for its professionals averaged $195 per hour in January. Overhead costs in January totaled $119,150. Overhead is applied to clients at $60 per labor-hour. In addition, QPS had $155,500 in marketing and administrative costs (not including the professional labor time as described). All transactions are on account. All services were billed. Transaction Description (a) Record labor cost (b) Record applied service overhead (c) Record cost of services billed (d) Record actual service overhead es Required: a. Show labor and overhead cost flows through T-accounts. b. Prepare an income statement for the company for January. Complete this question by entering your answers in the tabs below. Required A Required B Show labor and overhead cost flows through T-accounts. Wages Payable Debit Beginning balance Ending balance Work-in-Process Credit Debit Credit Beginning balance Ending balance Cost of Services Billed Service Overhead Control Debit Credit Debit Credit Beginning balance Beginning balance Ending balance Applied Service Overhead Debit Credit Beginning balance Ending balance Ending balance Required A Required B

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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Queenston Professional Support (QPS) provides professional services (IT, payroll and billing, and so on) to firms requiring temporary
help in those areas. QPS bills clients for its various services based on the hours its professionals spend. In January, QPS professionals
billed 1,925 hours to clients and worked a total of 2,020 hours. (The difference includes time for training, preparing bids, and so on,
which are considered administrative costs.) QPS bills clients at the rate of $365 per hour; labor cost for its professionals averaged $195
per hour in January. Overhead costs in January totaled $119,150. Overhead is applied to clients at $60 per labor-hour. In addition, QPS
had $155,500 in marketing and administrative costs (not including the professional labor time as described). All transactions are on
account. All services were billed.
Transaction
Description
(a)
Record labor cost
(b)
Record applied service overhead
(c)
Record cost of services billed
(d)
Record actual service overhead
es
Required:
a. Show labor and overhead cost flows through T-accounts.
b. Prepare an income statement for the company for January.
Complete this question by entering your answers in the tabs below.
Required A Required B
Show labor and overhead cost flows through T-accounts.
Wages Payable
Debit
Beginning balance
Ending balance
Work-in-Process
Credit
Debit
Credit
Beginning balance
Ending balance
Cost of Services Billed
Service Overhead Control
Debit
Credit
Debit
Credit
Beginning balance
Beginning balance
Ending balance
Applied Service Overhead
Debit
Credit
Beginning balance
Ending balance
Ending balance
Required A
Required B
Transcribed Image Text:Queenston Professional Support (QPS) provides professional services (IT, payroll and billing, and so on) to firms requiring temporary help in those areas. QPS bills clients for its various services based on the hours its professionals spend. In January, QPS professionals billed 1,925 hours to clients and worked a total of 2,020 hours. (The difference includes time for training, preparing bids, and so on, which are considered administrative costs.) QPS bills clients at the rate of $365 per hour; labor cost for its professionals averaged $195 per hour in January. Overhead costs in January totaled $119,150. Overhead is applied to clients at $60 per labor-hour. In addition, QPS had $155,500 in marketing and administrative costs (not including the professional labor time as described). All transactions are on account. All services were billed. Transaction Description (a) Record labor cost (b) Record applied service overhead (c) Record cost of services billed (d) Record actual service overhead es Required: a. Show labor and overhead cost flows through T-accounts. b. Prepare an income statement for the company for January. Complete this question by entering your answers in the tabs below. Required A Required B Show labor and overhead cost flows through T-accounts. Wages Payable Debit Beginning balance Ending balance Work-in-Process Credit Debit Credit Beginning balance Ending balance Cost of Services Billed Service Overhead Control Debit Credit Debit Credit Beginning balance Beginning balance Ending balance Applied Service Overhead Debit Credit Beginning balance Ending balance Ending balance Required A Required B
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