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Franklin Construction Company expects to build three new homes during a specific accounting period. The estimated direct materials and labor costs are as follows: Expected Costs Direct labor Home 2 Home 1 Home 3 $ 75,000 102,000 $ 91,000 149,000 $179,000 198,000 Direct materials Assume Franklin needs to allocate two major overhead costs ($51,750 of employee fringe benefits and $40,410 of indirect materials costs) among the three jobs. Fringe Benefits: Allocated Cost House Allocation Rate Weight of Base $ 1 0 = 2 0 3 0 $ Total Indirect Materials: Weight of Base House Allocation Rate Allocated Cost X $ 1 0 X = 2 0 3 0 Total $ The cost components to determine the total cost of each house: Home 3 Total Expected Costs Home 1 Home 2 Direct labor Direct materials 0 Fringe benefits 0 Indirect Materials 0 $ 0 $ $ 0 C 0 Total cost Thornton Air is a large airline company that pays a customer relations representative $15,200 per month. The representative, who processed 1,090 customer complaints in January and 1,480 complaints in February, is expected to process 22,800 customer complaints during 2018. Required a. Determine the total cost of processing customer complaints in January and in February. Month Allocated Cost January February Thornton Corporation estimated its overhead costs would be $24,000 per month except for January when it pays the $109,320 annual insurance premium on the manufacturing facility. Accordingly, the January overhead costs were expected to be $133,320 ($109,320 $24,000). The company expected to use 7100 direct labor hours per month except during July, August, and September when the company expected 9,500 hours of direct labor each month to build inventories for high demand that normally occurs during the Christmas season. The company's actual direct labor hours were the same as the estimated hours. The company made 3,550 units of product in each month except July, August, and September, in which it produced 4,750 units each month. Direct labor costs were $24.70 per unit, and direct materials costs were $10.10 per unit. Required a. Calculate a predetermined overhead rate based on direct labor hours. b. Determine the total allocated overhead cost for January, March, and August. c. Determine the cost per unit of product for January, March, and August. d. Determine the selling price for the product, assuming that the company desires to earn a gross margin of $20.80 per unit. Required a. Calculate a predetermined overhead rate based on direct labor hours. b. Determine the total allocated overhead cost for January, March, and August. c. Determine the cost per unit of product for January, March, and August. d. Determine the selling price for the product, assuming that the company desires to earn a gross margin of $20.80 per unit. Complete this question by entering your answers in the tabs below. Reqs B to D Req A Calculate a predetermined overhead rate based on direct labor hours. (Round your answer to 2 decimal places.) Predetermined overhead rate per labor hour Req A Reqs B to D a. Calculate a predetermined overhead rate based on direct labor hours. b. Determine the total allocated overhead cost for January, March, and August c. Determine the cost per unit of product for January, March, and August. d. Determine the selling price for the product, assuming that the company desires to earn a gross margin of $20.80 per unit. Complete this question by entering your answers in the tabs below. Req A Reqs B to D Determine the total allocated overhead cost, the cost per unit of product and the selling price for the product for January, March, and August. Assume that the company desires to earn a gross margin of $20.80 per unit. (Do not round intermediate calculations. Round "Cost per unit" and "Price" to 2 decimal places.) January March August Total allocated overhead cost Cost per unit Price Reqs B to D> Req A
