Sign Up

Sign Up to our social questions and Answers Engine to ask questions, answer people’s questions, and connect with other people.

Sign In

Login to our social questions & Answers Engine to ask questions answer people’s questions & connect with other people.

Forgot Password

Lost your password? Please enter your email address. You will receive a link and will create a new password via email.

You must login to ask a question.

Please briefly explain why you feel this question should be reported.

Please briefly explain why you feel this answer should be reported.

Please briefly explain why you feel this user should be reported.

Share & grow the world's knowledge!

We want to connect the people who have knowledge to the people who need it, to bring together people with different perspectives so they can understand each other better, and to empower everyone to share their knowledge.

Vince Melders, of EcoScape Company, designs and installs custom lawn

Characteristics of Production Process, Cost Measurement

Vince Melders, of EcoScape Company, designs and installs custom lawn and garden irrigation systems for homes and businesses throughout the state. Each job is different, requiring different materials and labor for installing the systems. EcoScape estimated the following for the year:

Number of direct labor hours6,720
Direct labor cost$67,200
Overhead cost$50,400

During the year, the following actual amounts were experienced:

Number of direct labor hours6,045
Direct labor incurred$66,495
Overhead incurred$50,500

Required:

1. Should EcoScape use process costing or job-order costing?

Job-Order Costing

2. If EcoScape uses a normal costing system and overhead is applied on the basis of direct labor hours,

What is the overhead rate? Round your answer to the nearest cent.

Overhead Rate = Estimated Overheads / Direct labor hour

Overhead Rate = $50,400/6,720 = $7.50

What is the average actual wage rate?

 $66,495 / 6,045 = $11

What is the cost of an installation that takes $3,500 of direct materials and 20 direct labor hours?

3,500 + 20*11 + 20*7.5 = $3,870

Related Posts

Leave a comment

Latest News & Updates

QuizlyPro Latest Articles

McMann Solutions Inc. knowingly violates the Clean Water Act by discharging hazardous pollutants into a nearby river

McMann Solutions, Inc., knowingly violates the Clean Water Act by discharging hazardous pollutants into a nearby river. McMann Solutions is subject to a. neither a fine or imprisonment. b. fines but no criminal charges or imprisonment because a corporation cannot ...

Farm and Ranch Supply Co. discovers a cache of an unknown herbicide in a back corner of its warehouse

Farm and Ranch Supply Co. discovers a cache of an unknown herbicide in a back corner of its warehouse. Farm and Ranch repackages the product, relabeling it as “Farmer’s Friend” and stating on the label and in advertisements that it ...

Tiger Stripe owns and operates gasoline filling stations. Patrick’s Trucking delivers fuel to Tiger Stripe’s storage facility on a regular basis

Tiger Stripe owns and operates gasoline filling stations. Patrick’s Trucking delivers fuel to Tiger Stripe’s storage facility on a regular basis. On one occasion, Patrick fails to pay proper attention to his truck when he is unloading fuel into Tiger ...

Explore Our Blog