Lifestyle Roofing uses job order costing and applies manufacturing overhead too individual projects using predetermined overhead rates. In the Installation Division, overhead is applied on the basis of direct labour hours, and in the Disposal Division, overhead is applied on the basis of debris tonnage hauled to the landfill. At the beginning of the current year, management made the following budget estimates to determine overhead application rates. Annual Estimates Direct labor Manufacturing overhead Direct labor hours Tons of Debris Installation Disposal $750,000 $120,000 $100,000 $36.000 25,000 10,000 300 Job #652 for Bees Grocery measured 8,348 square-feet. The job was started and completed in May. Information pertaining to this project is provided below. Job no. 652 (8.348 square-feet) Cost of material used on job Direct labor cost Direct labor hours Tons of debris Installation Disposal $30.000 $7,800 250 0 b. What was the total cost of job #652 and what was its cost per square-foot? ( $1,000 $1,100 80 7

Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter4: Activity-based Costing
Section: Chapter Questions
Problem 30P: Primera Company produces two products and uses a predetermined overhead rate to apply overhead....
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Lifestyle Roofing uses job order costing and applies manufacturing overhead too individual projects
using predetermined overhead rates. In the Installation Division, overhead is applied on the basis of
direct labour hours, and in the Disposal Division, overhead is applied on the basis of debris tonnage
hauled to the landfill. At the beginning of the current year, management made the following budget
estimates to determine overhead application rates.
Annual Estimates
Direct labor
Manufacturing overhead
Direct labor hours
Tons of Debris
Job #652 for Bees Grocery measured 8,348 square-feet. The job was started and completed in May.
Information pertaining to this project is provided below.
Job no. 652 (8.348 square-feet)
Cost of material used on job
Installation Disposal
$750,000 $120,000
$100,000 $36,000
25,000
10,000
300
Direct labor cost
Direct labor hours
Tons of debris
Installation Disposal
$1,000
$1,100
$30.000
$7,800
250
0
b. What was the total cost of job # 652 and what was its cost per square-foot? (
80
7
Transcribed Image Text:Lifestyle Roofing uses job order costing and applies manufacturing overhead too individual projects using predetermined overhead rates. In the Installation Division, overhead is applied on the basis of direct labour hours, and in the Disposal Division, overhead is applied on the basis of debris tonnage hauled to the landfill. At the beginning of the current year, management made the following budget estimates to determine overhead application rates. Annual Estimates Direct labor Manufacturing overhead Direct labor hours Tons of Debris Job #652 for Bees Grocery measured 8,348 square-feet. The job was started and completed in May. Information pertaining to this project is provided below. Job no. 652 (8.348 square-feet) Cost of material used on job Installation Disposal $750,000 $120,000 $100,000 $36,000 25,000 10,000 300 Direct labor cost Direct labor hours Tons of debris Installation Disposal $1,000 $1,100 $30.000 $7,800 250 0 b. What was the total cost of job # 652 and what was its cost per square-foot? ( 80 7
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