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Cost of Services Produced Jean and Tom Perritz own and manage Happy Home Helpers, Inc. (HHH), a house-cleaning service. Each cleaning (cleaning one house one
Cost of Services Produced Jean and Tom Perritz own and manage Happy Home Helpers, Inc. (HHH), a house-cleaning service. Each cleaning (cleaning one house one time) takes a team of three house cleaners about 1.2 hours. On average, HHH completes about 12,000 cleanings per year. The following total costs are associated with the total cleanings: Direct materials ? Direct labor Variable overhead Fixed overhead $313,200 12,000 14,400 Next year, HHH expects to purchase $34,400 of direct materials. Projected beginning and ending inventories for direct materials are as follows: Direct materials Inventory Beginning $2,900 Ending 1,500 There is no work-in-process inventory; in other words, a cleaning is started and completed on the same day. Required: 1. Prepare a statement of services produced in good form. If an amount is zero, enter "O". Happy Home Helpers, Inc. Statement of Cost of Services Produced For the Coming Year Direct materials Beginning inventory Add: Purchases Materials available Less: Ending inventory Direct materials used in production Direct labor Cleaning overhead Total services production costs added Add: Beginning work in process 10000000 Less: Ending work in process Cost of services produced Feedback beginning and ending inventories materials. What effect would this have on cost of 2. What if HHH planned to purchase $39,300 of direct materials? Assume there would be no change i services produced? Cost of services produced would increase by $
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