Concept explainers
1.
Prepare
1.
Explanation of Solution
Budgeted overhead allocation rate: The budgeted overhead allocation rate is the rate at which the overhead is allocated. This is calculated by dividing the total fixed and variable
Prepare job cost sheets for M Products and R Markets.
M Products | R Markets | |
Professional labor cost: | ||
50 hours×$60 (1) | $3,000 | |
20 hours×$60 (1) | $1,200 | |
Professional support: | ||
50 hours×$40 (2) | 2,000 | |
20 hours×$40 (2) | 800 | |
Total | $5,000 | $2,000 |
Working Note (1):
Compute the cost of professional labor per hour.
Working Note (2):
Computed the cost of professional support per hour.
2.
Prepare job cost sheets for the two clients.
2.
Explanation of Solution
Prepare job cost sheets for the two clients.
M Products | R Markets | |
Professional labor cost: | ||
30 hours×$100 (3) | $3,000 | |
5 hours×$100 (3) | $500 | |
Associate labor cost: | ||
20 hours×$40 (4) | 800 | |
15 hours×$40 (4) | 600 | |
Design support: | ||
$3,800×.22 (5) | 836 | |
$1,100×.22 (5) | 242 | |
Staff support: | ||
50 hours×$26.67 (6) | 1,334 | |
20 hours×$26.67 (6) | 533 | |
Total | $5,970 | $1,875 |
Working Note (3):
Compute the cost of partner labor per hour.
Working Note (4):
Computed the cost of associate labor per hour.
Working Note (5):
Computed the cost of design support per partner and associate.
Working Note (6):
Computed the cost of staff support per partner and associate.
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Chapter 9 Solutions
Principles of Cost Accounting
- Principles of Cost AccountingAccountingISBN:9781305087408Author:Edward J. Vanderbeck, Maria R. MitchellPublisher:Cengage LearningManagerial AccountingAccountingISBN:9781337912020Author:Carl Warren, Ph.d. Cma William B. TaylerPublisher:South-Western College PubPrinciples of Accounting Volume 2AccountingISBN:9781947172609Author:OpenStaxPublisher:OpenStax College