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Vernon Construction Company expects to build three new homes during a specific accounting period. The estimated direct materials and labor costs are as follows.
Vernon 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 Home 2 $ 63,000 $ 98,000 Home 3: $189,000 104,000 135,000 190,000 Assume Vernon needs to allocate two major overhead costs ($52,500 of employee fringe benefits and $34,320 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. (Round "Allocation rate" to 2 decimal places.) Fringe Benefits: Allocation Home x Rate Weight of Base Allocated Cost 1 2 5 X M Total Indirect Materials: Home 1 2 3 Allocation Rate x Weight of Base Allocated Cost
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