Exercise $7-45($Algo$)$ Job Costing in a Service Organization $($LO $7-4)$

Farnsworth Executive Coaching $($FEC$)$ offers services to firms in advising executives on improving productivity and leadership. For

August, FEC worked $664$ hours for Grace Corporation and $394$ hours for Temple Construction. In addition, FEC had small

engagements with various clients totaling $129$ hours. FEC bills clients at the rate of $$620$ per hour; labor cost for its professional staff is

$$295$ per hour. Overhead costs in August totaled $$73,400.$ Overhead is applied to clients at $$65$ per labor$-$hour. In addition, FEC had

$$179,350$ in marketing and administrative costs. All transactions are on account. All services were billed.

Required:

a$.$ Show labor and overhead cost flows through T$-$accounts.

b$.$ Prepare an income statement for the company for August.

Complete this question by entering your answers in the tabs below.

Required $A$

Show labor and overhead cost flows through T$-$accounts.