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show all working 4. Pletts Home Builders, located in Spanish Lookout, constructs Mennonite houses for local residents within Belize. It uses a job-costing system with
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4. Pletts Home Builders, located in Spanish Lookout, constructs "Mennonite houses" for local residents within Belize. It uses a job-costing system with two direct-cost categories (direct materials and direct labour) and one indirect-cost pool (assembly support). Pletts uses direct labour-hours as the allocation basis for its assembly support costs. In 2019, Pletts budgeted its assembly support costs to be $3,562,000, and direct labour-hours to be 356,200 hours. At the end of 2019, Pletts compared the cost of different jobs that were started and completed Two-Room Model Three-Room Model Direct material costs s 358,740 S 574,136 Direct labour costs $ 85,630S 149,650 Direct labour-hours 2,045 3,050 The two direct costs are paid for on a contract basis, therefore, the costs of each are known when direct materials are used and when direct labour hours are worked In 2019, the actual assembly-support costs were $3,445,000, and the actual direct labour-hours were 265,000 hours. Required: 0) Compute the (a) budgeted indirect-cost rate and (b) actual indirect-cost rato (2 points) (ii) What are the job costs of the Two-Room Model and Three-Room Model using (a) normal costing and (6) actual costing? (16 points) (111) Why might Pletts Home Builders prefer normal costing over actual costing? (2 points) Step by Step Solution
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