Pinnacle Consulting Employs Two CPAs,each Having a Different Area of Specialization.Judy

question 99

Essay

Pinnacle Consulting employs two CPAs,each having a different area of specialization.Judy specializes in tax consulting and Steve specializes in management consulting.Pinnacle expects to incur total overhead costs of $519,750 during the year and applies overhead based on annual salary costs.Judy is a senior partner,her annual salary is $225,000,and she is expected to bill 2,000 hours during the year.Steve is a senior associate,his annual salary is $121,500,and he is expected to bill 1,800 hours during the year.
a.Calculate the predetermined overhead rate.
b.Assuming that the hourly billing rate should be set to cover the total cost of services plus a 20% markup,compute the hourly billing rates for Judy and Steve.

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Definitions:

Blood

A bodily fluid in humans and other animals that delivers necessary substances such as nutrients and oxygen to the cells and transports metabolic waste products away from those same cells.

DNA Ligase

An enzyme that facilitates the joining of DNA strands together by catalyzing the formation of a phosphodiester bond.

Restriction Enzyme

An enzyme that cuts DNA at specific recognition nucleotide sequences, widely used in molecular biology for DNA modification and cloning experiments.

Vector DNA

A molecule of DNA utilized to deliver genetic material into a cell, often used in genetic engineering and research to replicate or express particular genes.