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Wuffs Poodle Grooming Parlour has overheads of 8,400 per month. Each month 2,000 direct labour hours are worked and charged to specific jobs, each of
Wuffs Poodle Grooming Parlour has overheads of 8,400 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 50506 were: Direct materials () Direct labour (hours) Wage rate ( per hour) 20.00 5 12.00 Overheads are charged to jobs on a direct labour hour basis. The cost to the customer is full cost plus 60%. Required: Calculate the full cost and the amount to be charged to the customer for job number 50506. 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 = per direct labour hour The full cost of job number 50506 can now be calculated (Round your answer to 2 decimal places.): Direct materials Direct labour Overheads Full cost of the job Finally, the amount to be charged to the customer for job number 50506 can be calculated: (Round your answer to 2 decimal places.) Profit added Amount charged to customer
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