Fogelin Promotional Services Uses a Job Order System for Costing

question 119

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 $676,800, and a total of 7,200 billable hours for the year. The office and administrative costs were estimated at $403,200. 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 36.50 billable hours. What was the actual total cost of the job for Fogelin?

• A)$5,475
• B)$2,044
• C)$3,431
• D)$4,906

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Definitions:

Writing

The representation of language in a textual medium through the use of a set of signs or symbols.

Oral Contract

A verbal agreement between parties that is legally binding, though more difficult to prove than a written contract.

Sale

The act of selling or exchanging goods or services for money or other compensation.

Rafts

Platforms or structures made of buoyant materials, often wood, used for transport or as a floating base.