=+5-21 KK Service industry, time period used to calculate indirect cost rates OBJECTIVE 4 LazerLine Pty Ltd
Question:
=+5-21 KK Service industry, time period used to calculate indirect cost rates OBJECTIVE 4 LazerLine Pty Ltd produces annual reports and marketing materials for large companies. There are three categories of costs in its normal job-costing system: direct materials, direct labour and overhead (both variable and fixed), allocated on the basis of direct labour costs. Paula Pengyu, the financial controller, is concerned that an increasing number of clients are waiting until the last minute to send in their final orders, causing congestion and an increase in the variable manufacturing overhead rate because of higher overtime and facility and machine maintenance. This spike is during the ‘crazy’ months of January, February and March, when many companies are rushing to get out their marketing materials. Paula obtains the following budgeted data for 2015:
1 2
3 4
5 A B C D E F Jan–Mar April–June July–Sept Oct–Dec Total
Step by Step Answer:
Cost Accounting A Managerial Emphasis
ISBN: 9781442563377
2nd Edition
Authors: Monte Wynder, Madhav V. Rajan, Srikant M. Datar, Charles T. Horngren, William Maguire, Rebecca Tan