Managerial accounting. Chapter 18: Pre determined overhead rate, amount of overhead allocated problems

Exercise 18-17 Manzeck Company operates a snow-removal service. The company owns five trucks, each of which has a snow plow in the front to plow driveways and a snowthrower in the back to clear sidewalks. Because plowing snow is very tough on trucks, the company incurs significant maintenance costs. Truck depreciation and maintenance represents a significant portion of the company's overhead. The company removes snow at residential locations, in which case the drivers spend the bulk of their time walking behind the snowthrower machine to clear sidewalks. On commercial jobs, the drivers spend most of their time plowing. Manzeck allocates overhead based on labor hours. Total estimated overhead costs for the year are $43,700. Total estimated labor hours are 1,350 hours. The average residential property requires 0.5 hours of labor, while the average commercial property requires 2.5 hours of labor. The following additional information is available. Activity ost Pool Plowing Cost Drivers Square yards of surface plowed Snowthrowing Linear feet of sidewalk cleared Estimated $38,200 $5,500 Cost Drivers per Activity Igg,ooo 47,000 Determine the predetermined overhead rate under traditional costing. (Round answer to 2 decimal places, e.g. 12.50.) Predetermined overhead rate LINK TO TEXT Determine the amount of overhead allocated to the average residential job using traditional costing based on labor hours. (Round answer to 2 decimal places, e.g. 12.25.) Amount of overhead allocated LINK TO TEXT