Question:Jean and Tom Perritz own and manage Happy Home Helpers, Inc. (HHH), a house-cleaning service. Each cleaning (cleaning one house onetime) takes a team of three house cleaners about 2.1 hours. On average, HHH completes about 21,000 cleanings per year. The followingtotal costs are associated with the total cleanings:Direct materialsDirect labor$44,100705,600Variable overhead 21,000Fixed overhead25,200Required: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.

1. Prime Costs includes direct materials and direct labor. Direct materials are resources used to…

Answered: Question: Jean and Tom Perritz own and…

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter2: Basic Cost Management Concepts

Section: Chapter Questions

Problem 5CE: Jean and Tom Perritz own and manage Happy Home Helpers, Inc. (HHH), a house-cleaning service. Each...

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Cost of Services Produced 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 1.2 hours. On average, HHH completes about 12,000 cleanings per year. The following total costs are associated with the total cleanings: Direct materials ? Direct labor $314,400 Variable overhead 13,200 Fixed overhead 15,600 Next year, HHH expects to purchase $35,000 of direct materials. Projected beginning and ending inventories for direct materials are as follows: Direct materials Inventory Beginning $4,400 Ending 3,000 There is no work-in-process inventory; in other words, a cleaning is started and completed on the same day. Required: 1. Prepare a statement of services produced in good form. If an amount is zero, enter "0". Happy Home Helpers, Inc. Statement of Cost of Services Produced For the Coming Year Direct materials $fill in…
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?
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Current Attempt in Progress Splish College provides its own housekeeping services. The College director would like to outsource this service and has found a company that will provide the service for $49 per hour. The following information has been collected about the cost per hour to the college for performing its own housekeeping services Cost per hour of service: Cleaning supplies $3 Direct labour costs $27 Variable overhead $1 Total hours of housekeeping services per year 3,040 Total fixed overhead $55,080 (a) Your answer is partially correct Determine whether Splish College should outsource housekeeping, assuming that 50% of fixed costs can be eliminated if the service is outsourced. (If an amount reduces the net income then enter with a negative sign preceding the number, eg-15,000 or parenthesis, eg (15,000). While alternate approaches are possible, irrelevant fixed costs should be included in both options when solving this problem.) amber of hours: 040 In-house eaning supplies…
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Using ABC in a service company Blanchette Plant Service completed a special landscaping job for Kerry Company. Blanchette uses ABC and has the following predetermined overhead allocation rates: The Kerry job included $750 in plants; $1,300 in direct labor; one design; and 30 plants. Requirements What is the total cost of the Kerry job? If Kerry paid $3,540 for the job, what is the operating income or loss? If Blanchette desires an operating income of 30% of cost, how much should the company charge for the Kerry job?
Hicks Contracting collects and analyzes cost data in order to track the cost of installing decks on new home construction jobs. The following are some of the costs that they incur. Classify these costs as fixed or variable costs and as product or period costs. Lumber used to construct decks ($12.00 per square foot) Carpenter labor used to construct decks ($10 per hour) Construction supervisor salary ($45,000 per year) Depreciation on tools and equipment ($6,000 per year) Selling and administrative expenses ($35,000 per year) Rent on corporate office space ($34,000 per year) Nails, glue, and other materials required to construct deck (varies per job)
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: Required: 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? Explain the impact on the following: a. Prime cost per cleaning b. Conversion cost per cleaning c. Total variable cost per cleaning d. Total service cost per cleaning

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