Question

Neptune Accounting Services expects its accountants to work for 28 comma 000 direct labor hours per year. The​ company's estimated total indirect costs are $ 226 comma 000. The direct labor rate is $ 60 per hour. The company uses direct labor hours as the allocation base for indirect costs. If Neptune performs a job requiring 40 hours of direct​ labor, what is the total job​ cost? (Round any intermediate calculations to the nearest​ cent, and your final answer to the nearest​ dollar.)

Answer 1

$2,723

Step-by-step explanation:

Neptune Accounting Services

Costs:

Direct labor $2,400

(40 hours × $60 per hour)

Indirect labor 323

(40 hours×$8.07)

Total job cost $ 2723

Indirect labor

Estimated total indirect costs ÷direct labor hours per year =Predertermine allocation rate per direct labor hours

226,000/28,000

=8.07