Question
Hello I need help for this question to train for my future exam, can you please detail the calculations ? Thank you The Hilton Company
Hello I need help for this question to train for my future exam, can you please detail the calculations ? Thank you
The Hilton Company sells and services lawn mowers, snow blowers, and other equipment. The service department uses a job order cost system to determine the costs associated with each job for services such as oil changes, tune-ups, and repairs. The department assigns overhead costs through a cost recovery rate on the basis of direct labor hours. The customer's invoice includes the costs for parts and labor, assigned overhead costs, and a 15% markup on total job costs in order to provide a reasonable profit for Hilton. Hilton Company's service department estimated the following information for the current year:
Wages of mechanics270,000
General and administrative36,000
Depreciation on equipment and tools54,000
Billable direct labor hours6,000
1) Determine Hilton Company's recovery rate for charging overhead costs.
2) Job 123 required 52 of materials and 0.8 direct labor hours. Determine the price charged to the customer for Job 123.
3) Explain how the numbers in b) can be useful for Hilton's managers.
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started