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Enlighten Services, Inc During the Current Month, Enlighten's Consultants Spent 150 Labor Hours

question 132

Multiple Choice

Enlighten Services, Inc., a management consulting firm, has been using a single predetermined overhead allocation rate with direct labor hours as the allocation base to allocate overhead costs. The direct labor rate is $50 per hour. Miriam Levy, the president of Enlighten, decided to develop an ABC system to accurately allocate the indirect costs. She identified two activities related to the total indirect costs-travel and information technology (IT) support. The other relevant details are given below: $\begin{array} { | l | l | l | l | } \hline \text { Activity } & \text { Allocation base } & \text { Estimated costs } & \begin{array} { l } \text { Estimated quantity } \\\text { of allocation base }\end{array} \\\hline \text { Travel } & \text { Miles driven } & \$ 90,000 & 1500 \text { miles } \\\hline \text { IT Support } & \text { Direct labor hours } & 58,000 & 1400 \mathrm { DLHr } \\\hline \text { Total } & & \$ 148,000,00 & \\\hline\end{array}$ During the current month, Enlighten's consultants spent 150 labor hours for Malka, Inc. The job required the professionals to travel 450 miles in total. Determine the total cost of the consulting job using the ABC system. (Round any intermediate calculations to the nearest cent and your final answer to the nearest dollar.)

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