Solved

Enlighten Services,Inc During the Current Month,Enlighten's Consultants Spent 150 Labor Hours for Overhead

Question 107

Multiple Choice

Enlighten Services,Inc.,a management consulting firm,has been using a single predetermined overhead allocation rate with direct labor hours as the allocation base to allocate overhead costs.The direct labor rate is $50 per hour.Miriam Levy,the president of Enlighten,decided to develop an ABC system to accurately allocate the indirect costs.She identified two activities related to the total indirect costs-travel and information technology (IT) support.The other relevant details are given below:  Activity  Allocation base  Estimated costs  Estimated quantity  of allocation base  Travel  Miles driven $90,0001500 miles  IT Support  Direct labor hours 58,0001400DLHr Total $148,000.00\begin{array} { | l | l | l | l | } \hline \text { Activity } & \text { Allocation base } & \text { Estimated costs } & \begin{array} { l } \text { Estimated quantity } \\\text { of allocation base }\end{array} \\\hline \text { Travel } & \text { Miles driven } & \$ 90,000 & 1500 \text { miles } \\\hline \text { IT Support } & \text { Direct labor hours } & 58,000 & 1400 \mathrm { DLHr } \\\hline \text { Total } & & \$ 148,000.00 & \\\hline\end{array} During the current month,Enlighten's consultants spent 150 labor hours for Malka,Inc.The job required the professionals to travel 450 miles in total.Determine the total cost of the consulting job using the ABC system.(Round any intermediate calculations to the nearest cent and your final answer to the nearest dollar.)


A) $7500
B) $2072
C) $6215
D) $40,715

Correct Answer:

verifed

Verified

Unlock this answer now
Get Access to more Verified Answers free of charge

Related Questions

Unlock this Answer For Free Now!

View this answer and more for free by performing one of the following actions

qr-code

Scan the QR code to install the App and get 2 free unlocks

upload documents

Unlock quizzes for free by uploading documents