Question
Jordan Construction Company expects to build three new homes during a specific accounting period. The estimated direct materials and labor costs are as follows.
Jordan Construction Company expects to build three new homes during a specific accounting period. The estimated direct materials and labor costs are as follows. Expected Costs Direct labor Direct materials Home 1 $ 69,000 102,000 Home 2 $ 103,000 131,000 Home 3 $177,000 196,000 Assume Jordan needs to allocate two major overhead costs ($34,900 of employee fringe benefits and $12,870 of indirect materials costs) among the three jobs. Required Choose an appropriate cost driver for each of the overhead costs and determine the total cost of each house. Note: Round "Allocation rate" to 2 decimal places. Fringe Benefits: Home Allocation Rate 1 2 3 Total Indirect Materials: Home 1 2 3 x x Weight of Base Allocated Cost Allocation x Rate Weight of Base Allocated Cost x x x Total The cost components to determine the total cost of each house: Expected Costs Home 1 Home 2 Home 31 Total
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