Ever Clean Company provides gutter cleaning services to residential clients. Overhead is allocated based on direct labor-hours (DLH). The owner, Joanne Clark, estimates that her gutter cleaners will work a total of 1,000 jobs during the year. Each job averages 600 feet of gutter surface and requires 12 direct labor-hours. Clark pays her gutter cleaners $15 per hour. The following table presents the budgeted overhead costs for 2018: Supplies ($6.50 per DLH) Fixed costs (to support capacity of 12,000 DLH) Indirect labor Depreciation Other Total budgeted costs The direct labor budget (in hours) is closest to OA. 12,000 Variable costs O B. 1,000 O C. 180,000 $ 78,000 25,000 17,000 24,000 $144,000

FINANCIAL ACCOUNTING
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ISBN:9781259964947
Author:Libby
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Chapter1: Financial Statements And Business Decisions
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Ever Clean Company provides gutter cleaning services to residential clients.
Overhead is allocated based on direct labor-hours (DLH). The owner, Joanne Clark,
estimates that her gutter cleaners will work a total of 1,000 jobs during the year.
Each job averages 600 feet of gutter surface and requires 12 direct labor-hours.
Clark pays her gutter cleaners $15 per hour. The following table presents the
budgeted overhead costs for 2018:
Supplies ($6.50 per DLH)
Fixed costs (to support capacity of 12,000 DLH)
Indirect labor
Depreciation
Other
Total budgeted costs
The direct labor budget (in hours) is closest to
O A. 12,000
Variable costs
O B. 1,000
O C. 180,000
$ 78,000
25,000
17,000
24,000
$144,000
Transcribed Image Text:Ever Clean Company provides gutter cleaning services to residential clients. Overhead is allocated based on direct labor-hours (DLH). The owner, Joanne Clark, estimates that her gutter cleaners will work a total of 1,000 jobs during the year. Each job averages 600 feet of gutter surface and requires 12 direct labor-hours. Clark pays her gutter cleaners $15 per hour. The following table presents the budgeted overhead costs for 2018: Supplies ($6.50 per DLH) Fixed costs (to support capacity of 12,000 DLH) Indirect labor Depreciation Other Total budgeted costs The direct labor budget (in hours) is closest to O A. 12,000 Variable costs O B. 1,000 O C. 180,000 $ 78,000 25,000 17,000 24,000 $144,000
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