Munoz Construction Company expects to build three new homes during a specific accounting period. The estimated direct materials and labor costs are as follows: Expected Costs Direct labor Direct materials Home 2 $103,000 139,000 Home 3 $176,000 192,000 Home 1 $ 76,000 90,000 Assume Munoz needs to allocate two major overhead costs ($53,250 of employee fringe benefits and $12,630 of indirect materials costs) among the three jobs. Required Choose an appropriate cost driver for each of the overhead costs and determine the total cost of each house. (Round "Allocation rate" to 2 decimal places.)

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Munoz Construction Company expects to build three new homes during a specific accounting period. The estimated direct materials
and labor costs are as follows:
Expected Costs
Direct labor
Direct materials
Home 2
$103,000
139,000
Home 3
$176,000
192,000
Home 1
$ 76,000
90,000
Assume Munoz needs to allocate two major overhead costs ($53,250 of employee fringe benefits and $12,630 of indirect materials
costs) among the three jobs.
Required
Choose an appropriate cost driver for each of the overhead costs and determine the total cost of each house. (Round "Allocation
rate" to 2 decimal places.)
Transcribed Image Text:Munoz Construction Company expects to build three new homes during a specific accounting period. The estimated direct materials and labor costs are as follows: Expected Costs Direct labor Direct materials Home 2 $103,000 139,000 Home 3 $176,000 192,000 Home 1 $ 76,000 90,000 Assume Munoz needs to allocate two major overhead costs ($53,250 of employee fringe benefits and $12,630 of indirect materials costs) among the three jobs. Required Choose an appropriate cost driver for each of the overhead costs and determine the total cost of each house. (Round "Allocation rate" to 2 decimal places.)
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