Aminta Accounting Expects Its Accountants to Work a Total of 30,000

Aminta Accounting expects its accountants to work a total of 30,000 direct labor hours per year. Aminta's estimated total indirect costs are $150,000. The direct labor rate is $100 per hour. Direct labor hours is the allocation base for indirect costs. If Aminta does a job requiring 50 hours of direct labor and bills the client using a standard markup of 40%, calculate the amount of the client's bill.

A) $7,700
B) $4,900
C) $7,000
D) $7,350

Correct Answer:

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