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. . . Joe's Lawn Care Service primarily mows lawns for residential customers. Management has determined direct labor hours is the primary cost driver and
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Joe's Lawn Care Service primarily mows lawns for residential customers. Management has determined direct labor hours is the primary cost driver and has developed the following cost equations based on direct labor hours: a. Prepare a flexible budget for each of the following activity levels: 550, 600, 650, and 700 direct labor hours. Note: Round costs per DLH to two decimal places (i.e. round $4.355 to $4.36 ). b. Determine the total cost per direct labor hour at each of the levels of activity. Note: Round your answers to two decimal places. c. The company normally records 650 direct labor hours during June. Each job typically requires 1.45 hours of labor time. If management wants to earn a profit equal to 40 percent of the costs incurred, what should the charge be to an average lawn-care customer? Note: Round your answer to two decimal places. \begin{tabular}{|c|c|c|c|c|c|c|c|c|} \hline & & irec & ct & & & & & \\ \hline & & & & & & & & \\ \hline Variable costs: & & & & & & & & \\ \hline Supplies & $ & 0 & $ & 0 & $ & 0 & $ & 0 \\ \hline Direct labor & & 0 & & 0 & & 0 & & 0 \\ \hline Overhead & & 0 & & 0 & & 0 & & 0 \\ \hline Total variable costs & $ & 0 & $ & 0 & $ & 0 & $ & 0 \\ \hline Variable cost per DLH & $ & 0 & $ & 0 & $ & 0 & $ & 0 \\ \hline Fixed costs: & & & & & & & & \\ \hline Overhead & $ & 0 & $ & 0 & $ & 0 & $ & 0 \\ \hline Fixed costs per DLH & $ & 0 & $ & 0 & $ & 0 & $ & 0 \\ \hline \end{tabular}
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