ADF Provides Consulting Services and Uses a Job-Order System to Accumulate

question 36

Essay

ADF provides consulting services and uses a job-order system to accumulate the cost of client projects. Traceable costs are charged directly to individual clients; in contrast, other costs incurred by ADF, but not identifiable with specific clients, are charged to jobs by using a predetermined overhead application rate. Clients are billed for directly chargeable costs, overhead, and a markup.
ADF anticipates the following costs for the upcoming year:
ADF's partners desire to make a $480,000 profit for the firm and plan to add a percentage markup on total cost to achieve that figure.
On May 14, ADF completed work on a project for Lawrence Manufacturing. The following costs were incurred: professional staff salaries, $68,000; administrative support staff, $8,900; travel, $10,500; and other operating costs, $2,600.
Required:
A. Determine ADF's total traceable costs for the upcoming year and the firm's total anticipated overhead.
B. Calculate the predetermined overhead rate. The rate is based on total costs traceable to client jobs.
C. What percentage of total cost will ADF add to each job to achieve its profit target?
D. Determine the total cost of the Lawrence Manufacturing project. How much would Lawrence be billed for services performed?

Recognize the main causes of water contamination in developed and developing countries.

Identify the strategies for oil spill prevention and cleanup.

Distinguish the different approaches and outcomes of water pollution laws in various countries.

Understand the significance of protecting groundwater and the strategies to prevent its pollution.

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Definitions:

Increased Profitability

Increased profitability signifies a rise in the difference between a business's revenues and its expenses, indicating improved financial performance.

Moore's Law

The observation that the number of transistors on a microchip doubles about every two years, though the cost of computers is halved.

Computing Power

The capacity of a computer system to process or calculate data, measured in terms of speed and efficiency.

Sense of Urgency

is the feeling that one’s actions must be immediate and rapid to accomplish goals or respond to situations.