Costs of Services Jean and Tom Perritz own and manage Happy Home Helpers, Inc. (HHH), a house-cleaning service. Each cleaning (cleaning one house one time) takes a team of three house cleaners about 1.5 hours. On average, HHH completes about 15,000 cleanings per year. The following total costs are associated with the total cleanings: Direct materials $ 27,000 Direct labor 472,500 Variable overhead 15,000 Fixed overhead 18,000 Required: If required, round your answers to the nearest cent. 1. Calculate the prime cost per cleaning. 2. Calculate the conversion cost per cleaning. 3. Calculate the total variable cost per cleaning. 4. Calculate the total service cost per cleaning. 5. What if rent on the office that Jean and Tom use to run HHH increased by $1,500? Which of the following statements best describes the effect of this on HHH's costs?
Costs of Services
Jean and Tom Perritz own and manage Happy Home Helpers, Inc. (HHH), a house-cleaning service. Each cleaning (cleaning one house one time) takes a team of three house cleaners about 1.5 hours. On average, HHH completes about 15,000 cleanings per year. The following total costs are associated with the total cleanings:
| Direct materials | $ 27,000 |
| Direct labor | 472,500 |
| Variable |
15,000 |
| Fixed overhead | 18,000 |
Required:
If required, round your answers to the nearest cent.
1. Calculate the prime cost per cleaning.
2. Calculate the conversion cost per cleaning.
3. Calculate the total variable cost per cleaning.
4. Calculate the total service cost per cleaning.
5. What if rent on the office that Jean and Tom use to run HHH increased by $1,500? Which of the following statements best describes the effect of this on HHH's costs?
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