The company applies all of its overhead costs to jobs based on direct labor-hours. At the beginning of the year, it made the following estimates: Direct labor-hours required to support estimated output Fixed overhead cost Variable overhead cost per direct labor-hour Required: 1. Compute the predetermined overhead rate. 2. During the year, Mr. Wilkes brought in his vehicle to replace his brakes, spark plugs, and tires. The following information pertains to his job: $ 590 $ 109 6 20,000 $ 350,000 $ 1.00 Direct materials Direct labor cost Direct labor-hours used Compute Mr. Wilkes' total job cost. 3. If Speedy establishes selling prices using a markup percentage of 40% of its total job cost, then how much would it have charged Mr. Wilkes?
The company applies all of its overhead costs to jobs based on direct labor-hours. At the beginning of the year, it made the following estimates: Direct labor-hours required to support estimated output Fixed overhead cost Variable overhead cost per direct labor-hour Required: 1. Compute the predetermined overhead rate. 2. During the year, Mr. Wilkes brought in his vehicle to replace his brakes, spark plugs, and tires. The following information pertains to his job: $ 590 $ 109 6 20,000 $ 350,000 $ 1.00 Direct materials Direct labor cost Direct labor-hours used Compute Mr. Wilkes' total job cost. 3. If Speedy establishes selling prices using a markup percentage of 40% of its total job cost, then how much would it have charged Mr. Wilkes?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Concept explainers
Variance Analysis
In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance.
Standard Costing
The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.
Topic Video
Question
please solve it and show computation and explantion clearly with steps for all requirements thanks
Transcribed Image Text:Speedy Auto Repairs uses job-order costing. Its direct materials consist of replacement parts installed in customer vehicles, and its
direct labor consists of the mechanics' hourly wages. Speedy's overhead costs include various items, such as the shop manager's
salary, depreciation of equipment, utilities, insurance, and magazine subscriptions and refreshments for the waiting room.
The company applies all of its overhead costs to jobs based on direct labor-hours. At the beginning of the year, it made the following
estimates:
Direct labor-hours required to support estimated output
Fixed overhead cost
Variable overhead cost per direct labor-hour
Required:
1. Compute the predetermined overhead rate.
2. During the year, Mr. Wilkesbrought in his vehicle to replace his brakes, spark plugs, and tires. The following information pertains to
his job:
Direct materials
Direct labor cost
Direct labor-hours used
$ 590
$ 109
6
20,000
$ 350,000
$1.00
Compute Mr. Wilkes' total job cost.
3. If Speedy establishes selling prices using a markup percentage of 40% of its total job cost, then how much would it have charged
Mr. Wilkes?
Transcribed Image Text:Complete this question by entering your answers in the tabs below.
Required 1 Required 2
Compute the predetermined overhead rate.
Note: Round your answer to 2 decimal places.
Predetermined overhead rate
Required 1 Required 2
Complete this question by entering your answers in the tabs below.
Required 3
Direct materials
Direct labor
Overhead applied
Total cost assigned to Mr. Wilkes
Required 3
Compute Mr. Wilkes' total job cost.
Note: Round your intermediate calculations to 2 decimal places.
per DLH
$
0
Complete this question by entering your answers in the tabs below.
Required 1 Required 2 Required 3
If Speedy establishes selling prices using a markup percentage of 40% of its total job cost, then how much would it have
charged Mr. Wilkes?
Note: Round your intermediate calculations to 2 decimal places.
Amount charged to Mr. Wilkes
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 5 steps with 2 images
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education