Fogelin Promotional Services Uses a Job Order System for Costing

question 62

Multiple Choice

Fogelin Promotional Services uses a job order system for costing and billing promotional services for dance and ballet performances. Fogelin has 4 public relations specialists, plus an office staff. At the beginning of 2014, Fogelin estimated the total cost of salaries and benefits for the public relations specialists at $403,200, and a total of 7,200 billable hours for the year. The office and administrative costs were estimated at $676,800. The allocation base for office and administrative costs is billable hours. In June, Fogelin signed a contract for a Russian ballet performance. They negotiated a price of $6,400 for their services. When the job was complete, Fogelin's records showed that they had logged 36.5 billable hours. What was the amount of gross profit that Fogelin made on the job?

• A)$1,494
• B)$2,969
• C)$925
• D)$4,356

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Definitions:

Endosperm

A material formed within the seeds of the majority of flowering plants after fertilization, providing nutrition to the growing embryo.

Ovary Wall

The protective outer layer of the ovary in female organisms, enclosing the ovules or eggs.

Carpels

The female reproductive organs of a flower, comprising the stigma, style, and ovary, which may occur singly or fused together to form a compound ovary.