Bhavik's Accounting Services Uses Job Costing and Applies Overhead Using

question 65

Multiple Choice

$\begin{array}{lccc}&\text { Professional} & \text { Other Direct } & \text {Professional }\\&\text { Labour Cost } & \text { Costs } & \text { Labour Hours }\\\text { Client } 57 & \$ 2,000 & \$ 800 & 20 \\\text { Client } 58 & 1,000 & 200 & 10 \\\text { Client 59 } & 5,000 & 600 & 50\end{array}$ Bhavik's Accounting Services uses job costing and applies overhead using a normal costing system using professional labour hours as the allocation base. This period's estimated overhead cost is $400,000, estimated professional labour cost is $800,000 and estimated direct labour hours are 8,000. This period actual overhead cost was $426,400, actual direct labour cost was $820,000, and actual direct labour hours were 8,200.
What is the overhead allocation rate?

• A) $60/hour
• B) $55/hour
• C) $52/hour
• D) $50/hour

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Definitions:

Intelligence Quotient

Intelligence Quotient, commonly known as IQ, is a measure of a person's intellectual abilities in relation to their age group.

IQ Tests

Standardized tests designed to measure human intelligence and cognitive ability in relation to an age group.

Spearman's Concept

Refers to Charles Spearman's theory of general intelligence ('g'), suggesting that individual cognitive abilities are expressions of a single, underlying intelligence factor.

Crystallized Intelligence

The ability to use learned knowledge and experience effectively.