Accounting 9706 · AS & A Level · Traditional costing methods

Traditional costing methods — practice question

A business offers accounting services to its clients. One of its employees needs 30 hours to finish a job. The employee’s hourly rate is $25. The business absorbs its overheads at a rate of $10 per labour hour. It adds 20% profit to the total cost of the job. What is the total price of the job charged to the client?

  • A$900
  • B$1050
  • C$1200
  • D$1260

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