The following data is available for Chattanooga Spokes 'N Wheels Repair Shop for 2022:Repair technicians' wages $360,000Fringe benefitsOverheadTotal80,00060,000$500,000The desired profit margin is $40 per labor hour. The material loading charge is 40% of partsinvoice cost. It is estimated that 5,000 labor hours will be worked in 2022.In March 2022, Spokes 'N Wheels repairs a bicycle that takes two hours to repair and usesparts of $240. The bill for this repair would beEnter the amount to two decimal places. Dollar sign not needed.

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Description: The following data is available for Chattanooga Spokes 'N Wheels Repair Shop for 2022:Repair technicians' wages $360,000Fringe benefitsOverheadTotal80,00060,000$500,000The desired profit margin is $40 per labor hour. The material loading charge is 4

Lets understand the basics.job cost is a total of direct material, direct labor and overhead cost…

Business

Accounting

The following data is available for Chattanooga Spoke Repair technicians' wages $360,000 Fringe benefits Overhead Total 80,000 60,000 $500,000 The desired profit margin is $40 per labor hour. The material loading charge is 40% invoice cost. It is estimated that 5,000 labor hours will be worked in 2022. In March 2022, Spokes 'N Wheels repairs a bicycle that takes two hours to repair

The following data is available for Chattanooga Spoke Repair technicians' wages $360,000 Fringe benefits Overhead Total 80,000 60,000 $500,000 The desired profit margin is $40 per labor hour. The material loading charge is 40% invoice cost. It is estimated that 5,000 labor hours will be worked in 2022. In March 2022, Spokes 'N Wheels repairs a bicycle that takes two hours to repair

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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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.

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Question

The following data is available for Chattanooga Spokes 'N Wheels Repair Shop for 2022:
Repair technicians' wages $360,000
Fringe benefits
Overhead
Total
80,000
60,000
$500,000
The desired profit margin is $40 per labor hour. The material loading charge is 40% of parts
invoice cost. It is estimated that 5,000 labor hours will be worked in 2022.
In March 2022, Spokes 'N Wheels repairs a bicycle that takes two hours to repair and uses
parts of $240. The bill for this repair would be
Enter the amount to two decimal places. Dollar sign not needed.

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