Question
Larry's Lawn Services provides custom landscaping for homes and businesses and uses job order costing to capture the cost of its landscaping jobs. There are
Larry's Lawn Services provides custom landscaping for homes and businesses and uses job order costing to capture the cost of its landscaping jobs. There are no jobs in process at the beginning of May. Listed below are data concerning the three landscaping jobs conducted during May.
SouthsideOceanviewRocky HeightsDirect materials$5,790$7,850$7,050Landscaper labor costs$4,686$5,874$6,138Landscaper hours718993
Overhead costs are applied to jobs on the basis of landscaper hours, and the predetermined overhead rate is $64per landscaper hour. The Southside job is the only incomplete job at the end of May. Actual overhead for the month was $16,542.
During May, Larry is approached by the owner of Mountain Estates who would like to contract with Larry's company. Larry is working to prepare the bid for Mountain Estates and has the following information: Direct materials, $10,840and Landscaper hours,125hours.
Analyze the financial information provided for Southside, Oceanview and Rocky Heights and help Larry complete his bid by estimating the total cost of the Mountain Estates job.
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