Pompom Veterinary Practice has overheads of 9,400 each month. Each month 200 direct labour hours are worked and charged to specic jobs, each of which involves minor operations on domestic pets. The business has received an enquiry from Newcastle Kennels, which wants Pompom to take on a regular contract to provide veterinary services to Newcastle's dogs. Pompom estimates that taking on the contract will have the following nancial implications per month: 0 (click here to view financial information) Overheads are charged to jobs on a direct labour hour basis. The cost to the customer is full cost plus 70%. Newcastle Kennels is prepared to pay a maximum fee of 187 per month. Required: Calculate the full cost and the amount to be charged to Newcastle Kennels. Should Pompom Veterinary Practice take on the contract? More info Firstly, the overhead absorption rate can be found by this formula: (Complete the necessary drop downs.) Direct materials (E) Direct labour (hours) Wage rate (E per hour) The values can now be inserted (calculate the overhead absorption rate to two decimal places): Overhead absorption rate = = per direct labour hour The full cost of the proposed contract can now be calculated (give the answer to two decimal pla Hardy Ltd provides a customised, interior design service for wealthy individuals. The service relies heavily on the skill of the various painters and decorators who execute the plans that have been agreed. a (Click here to View the business predicts during the forthcoming month.) Calculate a suitable overhead recovery rate per hour for the business. (All workings to nearest whole number.) A suitable overhead recovery rate per hour for the business is Hexford Ltd offers a complete interior design service for homes owned by wealthy individuals. The business has the following estimates for next month: E (Click here to view the estimate.) The business has received an enquiry about the interior design of a kitchen. It is estimated that it will take 150 direct labour hours to design and fit. It will also require materials costing 28,000. The business normally uses a direct labour hour basis of charging indirect cost (overheads) to individual jobs. 1. What will be the direct cost of designing and fitting the kitchen? 2. What is the overhead recovery rate per hour? 3. What will be the full (absorption) cost of designing and tting the kitchen? All calculations to nearest pence. Data table The direct cost of designing and tting the kitchen = The overhead recovery rate per hour = Direct labour oost 168,000 The full (absorption) cost of designing and fitting the kitchen = Direct labour time 10 000 hours Rent 22,000 Depreciation of equipment 5,000 Supervisors' salaries 20,000 Heating, lighting and power 8,000 Indirect materials 5,000 Other miscellaneous indirect cost elements (overheads) 4,000 Direct materials cost 58,000 Greenstead Boats Ltd provides a boat repair service. Each month 10,000 direct labour hours are worked and charged to cost units (jobs carried out by the business). The business has overheads of 116,000 each month. A recent boat repair undertaken by the business used direct materials costing 2,215. Direct labour worked on the repair was 25 hours and the wage rate is 17 an hour. The business charges overheads to jobs on a direct labour hour basis. What is the full (absorption) cost oi the job? (Round to nearest pence.) The full (absorption) cost of the job is f Hardy Ltd provides a customised, interior design sen/ice for weal the plans that have been agreed. _ X a (Click here to view the business predicts during the forthco Data table Calculate a suitable overhead recovery rate per hour for the busi Direct materials cost 84,000 . . . Direct labour time 3,500 hours A sunable overhead recovery rate per hour for the busmess IS Machine hours 800 hours Supervisors' salaries 28,000 Depreciation of machinery 900 Rent of studio and factory 16,000 Heat light and power 1,300 Repairs to studio and factory 11,400 Indirect materials 10,400 Direct, travel related cost 5,000 Direct labour cost 88,000 Done Barkers Poodle Grooming Parlour has overheads of $9,000 per month. Each month 2,000 direct labour hours are worked and charged to specific jobs, each of which involves grooming dogs for shows. The costs and time incurred on job number 64427 were: Direct materials (E) 36.00 Direct labour (hours) 5 Wage rate ({ per hour) 14.00 Overheads are charged to jobs on a direct labour hour basis. The cost to the customer is full cost plus 80%. Required: Calculate the full cost and the amount to be charged to the customer for job number 64427. Firstly, the overhead absorption rate can be found by this formula: (Complete the necessary drop downs.) The values can now be inserted (Calculate the overhead absorption rate to two decimal places.): Overhead absorption rate = = f per direct labour hour The full sect of inh number 64427 can now ha calculated (Round vour anewor to ? decimal places ).Rooney (Electricals) Ltd offers on-site, household appliance repairs to householders. Each month, there are 1600.00 direct labour hours worked on repairs to washing machines, dishwashers and freezers. During the most recent month, the business incurred the following expenses: E Direct materials 10,000 Direct labour 28,000 Overheads 16,000 During the month, a dishwasher was repaired for a customer. Replacement parts cost 1 10 and a technician took 2 hours to carry out the repair work. The business uses the direct labour hour basis for overhead recovery and charges an additional 45% to the full cost of a job as a prot mark-up. What should be the price charged to the customer for repairs to the dishwasher? (All calculations to nearest pence.) The price charged to the customer for repairs to the dishwasher is f