Application of Overhead The Terry CPA firm has the following overhead budget for 201...

Application of Overhead The Terry CPA firm has the following overhead budget for 2013:

The firm estimates total direct labor cost in 2013 to be $1,600,000. The firm uses direct labor cost as the cost driver to apply overhead to clients.

During January, the firm worked for many clients; data for two of them follow:

Required

1. Compute the firm’s budgeted overhead rate.

2. Compute the amount of overhead to be charged to the Barry and Miles accounts using the predetermined overhead rate calculated in requirement 1.

3. Compute total job cost for the Barry account and the Miles account.