The Law Firm of Smith & Jones Has a Staff

question 168

Multiple Choice

The law firm of Smith & Jones has a staff of 30 lawyers and administrative staff.Budgeted total costs of the firm total $4,000,000 of which $2,500,000 is direct-labor costs.Assuming that the remaining costs are indirect and direct-labor cost is the allocation base,calculate the budgeted indirect cost rate.

• A) 38 of direct-labor cost
• B) 60% of direct-labor cost
• C) 63% of direct-labor cost
• D) 160% of direct-labor cost

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Definitions:

Massive Overstock

Describes a situation where a retailer or inventory-based business holds a significantly larger quantity of products than needed or demanded, leading to excess stock.

Safe Working Conditions

Standards and practices that ensure the physical and mental well-being of employees in their workplace.

Necessary Repairs

Essential maintenance or fixes required to restore an item, property, or infrastructure to a functional or safe state.

Known Unsafe Conditions

Situations or environments that have been recognized as hazardous and could potentially cause harm or injury.