Question
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
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 0.9 hours. On average, HHH completes about 9,000 cleanings per year. The following total costs are associated with the total cleanings:
Direct materials | $20,700 |
Direct labor | 274,500 |
Variable overhead | 13,500 |
Fixed overhead | 15,300 |
Required:
If required, round your answers to the nearest cent.
1. Calculate the prime cost per cleaning. $fill in the blank 1per cleaning
2. Calculate the conversion cost per cleaning. $fill in the blank 2per cleaning
3. Calculate the total variable cost per cleaning. $fill in the blank 3per cleaning
4. Calculate the total service cost per cleaning. $fill in the blank 4per cleaning
5. What if rent on the office that Jean and Tom use to run HHH increased by $900? Which of the following statements best describes the effect of this on HHH's costs?
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