Use the following labor budget data for Roy & Miller Accounting, LLP to answer the following Questions
The budgeted overhead cost for the year is $1,260,000. The company has estimated that one-third of the budgeted over¬head cost is incurred to support the firm’s two partners, and two-thirds goes to support the staff accountants. The current audit bid for Monoco Industries requires $18,000 in direct partner professional labor, $30,000 in direct staff accountant professional labor, $5,000 in direct material,
-If overhead is applied on the Monoco engagement based on a single-cost driver basis, what is the total cost of the engagement?
A) $101,000
B) $96,200
C) $43,200
D) $48,000
E) $85,000

Question

Use the following labor budget data for Roy & Miller Accounting, LLP to answer the following Questions
The budgeted overhead cost for the year is $1,260,000. The company has estimated that one-third of the budgeted over¬head cost is incurred to support the firm’s two partners, and two-thirds goes to support the staff accountants.   The current audit bid for Monoco Industries requires $18,000 in direct partner professional labor, $30,000 in direct staff accountant professional labor, $5,000 in direct material,
-If overhead is applied on the Monoco engagement based on a single-cost driver basis, what is the total cost of the engagement?
A) $101,000 
B) $96,200 
C) $43,200 
D) $48,000 
E) $85,000

Quizplus · Accepted Answer

The total cost of the engagement is calculated by applying overhead based on a single-cost driver, which results in a total of $96,200.

Use the Following Labor Budget Data for Roy & Miller