Use the Following Information to Answer the Following Questions

question 60

Multiple Choice

Use the following information to answer the following Questions
Bridges and Lloyd, an accounting firm, provides consulting and tax planning services. For many years, the firm's total administrative cost (currently $250,000) has been allocated to services on the basis of billable hours to clients. A recent analysis found that 65% of the firm's billable hours to clients resulted from tax planning services, while 35% resulted from consulting services.
The firm, contemplating a change to activity-based costing, has identified three components of administrative cost, as follows:

A recent analysis of staff support found a strong correlation between the number of staff personnel and the number of clients served (consulting, 20; tax planning, 60) . In contrast, in-house computing and miscellaneous office cost varied directly with the number of computer hours logged and number of client transactions, respectively. Consulting consumed 30% of the firm's computer hours and had 20% of the total client transactions.
-Assuming the use of activity-based costing, the proper percentage to use in allocating staff support costs to tax planning services is:

• A) 20%.
• B) 60%.
• C) 65%.
• D) 75%.
• E) 80%.

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Definitions:

Nations

Large groups of people united by common descent, history, culture, or language inhabiting a particular country or territory.

Chinese Immigrants

Individuals from China who have migrated to various parts of the world, often facing significant challenges and discrimination, especially noted in the 19th and early 20th centuries in the United States.

Persecutions

Systematic mistreatment of an individual or group by another group, often due to political, religious, or ethnic differences.

Lynchings

Extrajudicial killings, usually by hanging, carried out by a mob or group of people without legal authority, historically associated with the suppression of black people in the United States.