Thế Fly Company provides advertising services for clients across the nation. The Fly Company is presently working on four projects, each for a different client. The Fly Company accumulates costs for each account (client) on the basis of both direct costs and allocated indirect costs. The direct costs include the charged time of professional personnel and media purchases (air time and ad space). Overhead is allocated to each project as a percentage of media purchases. The predetermined overhead rate is 45% of media purchases. On August 1, the four advertising projects had the following accumulated costs: August 1 Balances Vault Bank $77,900 Take Off Airlines 23,400 Sleepy Tired Hotels 54,500 Tastee Beverages 33,500 Total $189,300 During August, The Fly Company incurred the following direct labor and media purchase costs related to preparing advertising for each of the four accounts: Direct Labor Medla Purchases Vault Bank $54,500 $201,800 Take Off Airlines 24,300 177,600 Sleepy Tired Hotels 107,100 129,700 Tastee Beverages 121,800 96,900 Total $307,700 $606,000

Thế Fly Company provides advertising services for clients across the nation. The Fly Company is presently working on four projects, each for a different client. The Fly Company accumulates costs for each account (client) on the basis of both direct costs and allocated indirect costs. The direct costs include the charged time of professional personnel and media purchases (air time and ad space). Overhead is allocated to each project as a percentage of media purchases. The predetermined overhead rate is 45% of media purchases. On August 1, the four advertising projects had the following accumulated costs: August 1 Balances Vault Bank $77,900 Take Off Airlines 23,400 Sleepy Tired Hotels 54,500 Tastee Beverages 33,500 Total $189,300 During August, The Fly Company incurred the following direct labor and media purchase costs related to preparing advertising for each of the four accounts: Direct Labor Medla Purchases Vault Bank $54,500 $201,800 Take Off Airlines 24,300 177,600 Sleepy Tired Hotels 107,100 129,700 Tastee Beverages 121,800 96,900 Total $307,700 $606,000

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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