Dursley & Marvolo, Attorneys at Law, provide a variety of legal services. The law firm uses an activity-based costing system and has developed the following activity pool cost rates: Cost and activity data related to two clients is as follows:
How much overhead cost would be allocated to Client 82 using the activity-based costing system?

Question

Dursley & Marvolo, Attorneys at Law, provide a variety of legal services. The law firm uses an activity-based costing system and has developed the following activity pool cost rates:  Cost and activity data related to two clients is as follows:
 How much overhead cost would be allocated to Client 82 using the activity-based costing system?

Quizplus · Accepted Answer

Client 82 would incur the following costs:
- Legal research: 9 hours x $200/hour = $1,800
- Document preparation: 13 pages x $25/page = $325
- Client conferences: 3 hours x $150/hour = $450

To allocate overhead costs, we need to use the activity pool cost rates:
- Legal research: 20% x $13,780 = $2,756
- Document preparation: 10% x $13,780 = $1,378
- Client conferences: 5% x $13,780 = $689

Therefore, total overhead cost allocated to Client 82 would be $2,756, as option C states.

Dursley & Marvolo, Attorneys at Law, Provide a Variety of Legal