Ad Spot provides advertising services to local business. It is calculating customer profitability for the previous year. Ad Spot uses a normal costing system to calculate the costs of servicing clients. Ad Spot applies manufacturing overhead costs to its clients at a rate of 10% of direct labor costs. Use the following information to answer the questions below. McDowell Jones Yang Bernanke Revenue $ 12,500 $ 15,435 $ 11,800 $ 6,000 Direct materials $ 4,414 $ 7,144 $ 4,360 $ 4,864 Direct labor $ 3,265 $ 4,518 $ 5,334 $ 1,120 Direct labor hours 172 251 314 63 what was the total cost of providing service to Bernanke last year? If Insomniacs Incorporated does not use an adjusting entry to correct manufacturing overhead, what will be the effect on net income (assuming no beginning or ending inventory balances)? By how much?

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To calculate the total cost of providing service to Bernanke last year we need to consider direct ma... View the full answer