Nicole Grandstone is a new staff accountant at James & Associates. She is paid a salary...

 

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Nicole Grandstone is a new staff accountant at James & Associates. She is paid a salary of $67,600 per year and is expected to work 2,600 hours per year on client jobs. The firm's indirect cost allocation rate is $25 per hour. The firm would like to achieve a profit equal to 20% of cost. 1. Convert Nicole's salary to an hourly wage rate for billing purposes. 2. Calculate the professional billing rate James & Associates would use for billing out Nicole's services. S3-6 Compute various manufacturing overhead rates (Learning Objective 3) Edmonton Pools manufactures swimming pool equipment. Edmonton estimates total 82 manufacturing overhead costs next year to be $1,400,000. Edmonton also estimates it will use 50,000 direct labor hours and incur $1,000,000 of direct labor cost next year. In addition, the machines are expected to be run for 40,000 hours. Compute the prede- termined manufacturing overhead rate for next year under the following independent situations: 1. Assume that the company uses direct labor hours as its manufacturing overhead allocation base. 2. Assume that the company uses direct labor cost as its manufacturing overhead allocation base. 3. Assume that the company uses machine hours as its manufacturing overhead allocation base. S3-7 Continuation of S3-6: compute total allocated overhead (Learning Objective 3) Use your answers from S3-6 to determine the total manufacturing overhead allocated to Edmonton's manufacturing jobs in the following independent situations: 1. Assume that the company actually used 51,700 direct labor hours. 2. Assume that the company actually incurred $1,020,000 of direct labor cost. 3. Assume that the company actually ran the machines 39,500 hours. 4. Briefly explain what you have learned about the total manufacturing overhead allo- cated to production. Nicole Grandstone is a new staff accountant at James & Associates. She is paid a salary of $67,600 per year and is expected to work 2,600 hours per year on client jobs. The firm's indirect cost allocation rate is $25 per hour. The firm would like to achieve a profit equal to 20% of cost. 1. Convert Nicole's salary to an hourly wage rate for billing purposes. 2. Calculate the professional billing rate James & Associates would use for billing out Nicole's services. S3-6 Compute various manufacturing overhead rates (Learning Objective 3) Edmonton Pools manufactures swimming pool equipment. Edmonton estimates total 82 manufacturing overhead costs next year to be $1,400,000. Edmonton also estimates it will use 50,000 direct labor hours and incur $1,000,000 of direct labor cost next year. In addition, the machines are expected to be run for 40,000 hours. Compute the prede- termined manufacturing overhead rate for next year under the following independent situations: 1. Assume that the company uses direct labor hours as its manufacturing overhead allocation base. 2. Assume that the company uses direct labor cost as its manufacturing overhead allocation base. 3. Assume that the company uses machine hours as its manufacturing overhead allocation base. S3-7 Continuation of S3-6: compute total allocated overhead (Learning Objective 3) Use your answers from S3-6 to determine the total manufacturing overhead allocated to Edmonton's manufacturing jobs in the following independent situations: 1. Assume that the company actually used 51,700 direct labor hours. 2. Assume that the company actually incurred $1,020,000 of direct labor cost. 3. Assume that the company actually ran the machines 39,500 hours. 4. Briefly explain what you have learned about the total manufacturing overhead allo- cated to production.

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Nicole Grandstones Billing Rate James Associates 1 Hourly Wage Rate Annual Salary 67600 We need to convert this to an hourly rate assuming a standard ... View the full answer