Question

Crow Design is an interior designem. The cost system in which each safer Design traces direct laborenings and travel detty to each o n it alles in based on a predetermined indirect cost action rate computed as a percentage of director costs Crow costs o wing but m At the beginning of the current year, managing the mirr e conto wow the produt) Later that same year in November Crow Design served several Records for the loon to view the records for t h is) Read the remonts her 1 Requirements 1 Data Table Data Table 1. Compute Crow Design's predetermined indirectos location rate for the current year 2. Compute the total cost of each of the two obited 3. Crow Design wants to earn proseguito 10% of sales reverve how much what totale should the company charge each of these two cents? 4. Why does Crow Design assists to jobs? Direct labor hours professional)...... 10.000 hours Direct labor costs professional)....$ 1400.000 Support all salaries Computer base payment 49.000 Office solis Director hours........ Licensing costs Travelco Tasty Coop 7 hours 3.000 StarNow.com 7 hours $ 250 $ prin Dono Print Done Print Done

Answer 1

Cost allocation rate = Total Indirect costs/Total Direct labor costs

= (170,000+49000+29000+60,000)/1,400,000

= 22%

2.

Calculation of total cost
	Tasty Corn	StarNow
Licensing costs	3,000	250
Travel Costs	6,000	-
Overhead costs	24,332	2,156
Total cost	33,332	2,406
Price charged	37,035.56	2,673.33
4.Costs are assigned so that to recover in sales revenue.