11.

Paul's Auto Repair uses time and material pricing. The body shop, which anticipates 10,000 direct labor hours of activity, has the following data:

Annual overhead costs:
Material handling and storage	$ 28,000
Other overhead costs	88,000
Annual cost of materials used	194,000
Labor rate per hour, including fringe benefits	21.25
Hourly charge to achieve profit margin	14.25

rev: 10_29_2012

The time charge per hour is (Do not round your intermediate calculations.):

Multiple Choice

$24.05.

$32.85.

$35.50.

$44.30.

None of these.

23.

Martina, Inc. has two service departments (Human Resources and Building Maintenance) and two production departments (Machining and Assembly). The company allocates Building Maintenance cost on the basis of square footage and allocates Building Maintenance first in step-down method. The square footage occupied by each department follows.

Human Resources	12,000
Building Maintenance	19,000
Machining	24,000
Assembly	32,000

rev: 10_29_2012

Assuming use of the direct method, over how many square feet would the Building Maintenance cost be allocated (i.e., spread)?

Multiple Choice

56,000.

68,000.

87,000.

More information is needed to judge.

31,000.