Bonanza Enterprises Provides Consulting Services and Uses a Job-Order System

question 65

Essay

Bonanza Enterprises provides consulting services and uses a job-order system to accumulate the cost of client projects. Traceable costs are charged directly to individual clients; in contrast, other costs incurred by Bonanza , but not identifiable with specific clients, are charged to jobs by using a predetermined overhead application rate. Clients are billed for directly chargeable costs, overhead, and a markup.
Bonanza anticipates the following costs for the upcoming year:

Bonanza's partners desire to make a $480,000 profit for the firm and plan to add a percentage markup on total cost to achieve that figure.
On May 14, Bonanza completed work on a project for Laramie Manufacturing. The following costs were incurred: professional staff salaries, $68,000; administrative support staff, $8,900; travel, $10,500; and other operating costs, $2,600.
Required:
A. Determine Bonanza's total traceable costs for the upcoming year and the firm's total anticipated overhead.
B. Calculate the predetermined overhead rate. The rate is based on total costs traceable to client jobs.
C. What percentage of total cost will Bonanza add to each job to achieve its profit target?
D. Determine the total cost of the Laramie Manufacturing project. How much would Laramie be billed for services performed?

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Definitions:

Ineffective Sexuality Pattern

A nursing diagnosis referring to a person's expressed concern regarding their sexuality and sexual relationships.

Values Conflicts

Discrepancies between the principles or beliefs of individuals or groups that can lead to disagreements or disputes.

Sexual Orientation

An enduring pattern of romantic or sexual attraction (or lack thereof) to persons of the opposite sex, same sex, both sexes, or more than one gender.

Sexual Dysfunction

A term used to describe any problems during any phase of the sexual response cycle that prevent the individual or couple from experiencing satisfaction from the sexual activity.