Hicks Contracting collects and analyzes cost data in order to track the cost of installing decks on new home construction jobs. The following are some of the costs that they incur. Classify these costs as fixed or variable costs and as product or period costs. A. Lumber used to construct decks ($12.00 per square foot) B. Carpenter labor used to construct decks ($10 per hour) C. Construction supervisor salary ($45,000 per year) D. Depreciation on tools and equipment ($6,000 per year) E. Selling and administrative expenses ($35,000 per year) F. Rent on corporate office space ($34,000 per year) G. Nails, glue, and other materials required to construct deck (varies per job)

Singh and Danzin is an architectural firm that provides services for residential construction projects. The following overhead cost data are from the current period. Budgeted Costs Budgeted Activity Usage contact Activity Client consultation $ 292,500 1,500 hours design hours Drawings 130,000 2,000 1. Compute an activity rate for each activity using activity-based costing. 2. Allocate overhead cost to a job that requires 60 contact hours and 355 design hours. 1. Compute an activity rate for each activity using activity-based costing. (Round "Activity rate" to 2 decimal places.) Budgeted Cost Activity Budgeted Activity Usage Activity Rate Client consultation Drawings 2. Allocate overhead cost to a job that requires 60 contact hours and 355 design hours. (Round "Activity Rate" to 2 decimal places and other answers to the nearest whole dollar amount.) Activity Activity Usage Activity Rate Allocated Cost Client consultation Drawings

Monte Services, Inc. is trying to establish the standard labor cost of a typical brake repair. The following data have been collected from time and motion studies conducted over the past month. Actual time spent on the brake repairs Hourly wage rate Payroll taxes Setup and downtime Cleanup and rest periods Fringe benefits (a) 5 hours $12 20% of wage rate 11% of actual labor time 34% of actual labor time 25% of wage rate Determine the standard direct labor hours per brake repairs. (Round answer to 2 decimal places, e.g. 1.25.) Standard direct labor hours per brake repair hours

Assigning Costs to Activities, Resource Drivers The receiving department has three activities: unloading, counting goods, and inspecting. Unloading uses a forklift that is leased for $15,000 per year. The forklift is used only for unloading. The fuel for the forklift is $3,600 per year. Other operating costs (maintenance) for the forklift total $1,500 per year. Inspection uses some special testing equipment that has depreciation of $1,200 per year and an operating cost of $750. Receiving has three employees who have an average salary of $50,000 per year. The work distribution matrix for the receiving personnel is as follows: Activity Percentage of Time on Each Activity Unloading 40% Counting 25 Inspecting 35 No other resources are used for these activities. Required: 1.  Calculate the cost of each activity. Unloading $fill in the blank 1 Counting $fill in the blank 2 Inspecting $fill in the blank 3 2. Explain the two methods used to assign costs to activities.

Labor costs of an auto repair mechanic are seldom based on actual hours worked. Instead, this labor cost is based on an industry average of time estimated to complete a repair job. This means a customer can pay, for example, $120 for two hours of work on a car when the actual time worked was only one hour. Many experienced mechanics can complete repair jobs faster than the industry average. Assume that you are asked to complete such a survey for a repair center. The survey calls for objective input, and many questions require detailed cost data and analysis. The mechanics and owners know you have the survey and encourage you to complete it in a way that increases the average billable hours for repair work. Required Write a one-page memorandum to the mechanics and owners that describes the direct labor analysis you will undertake in completing this survey.

Noteworthy, Incorporated, produces and sells small electronic keyboards. Assume that you have the following information about Noteworthy's costs for the most recent month. Depreciation on factory equipment Depreciation on CEO's company car Speakers used in the keyboard Production supervisor's salary Glue and screws used in the keyboards Cost to run an ad on local radio stations Wages of persons who install the speakers $ 820 180 1,140 2,370 250 2,970 Utilities for the factory Personnel manager's salary Wages of person who attaches legs to keyboards Required: 1. Calculate the total product cost for Noteworthy. 2. Calculate the prime cost for Noteworthy. 3. Calculate the manufacturing overhead for Noteworthy. 4. Calculate the direct labor for Noteworthy. 5. Calculate the conversion cost for Noteworthy. 650 1,250 2,640 2,070 6. Calculate the total variable cost (with number of units produced as the activity) for Noteworthy. 7. Calculate the total fixed cost (with number of units produced…

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Muffler Incorporated produces floor mats for cars and trucks. The owner, Kenneth Muffler, asked you to assist him in estimating his maintenance costs. Together, Mr. Muffler and you determined that the single best cost driver for maintenance costs was machine hours. Below are data from the previous fiscal year for maintenance expense and machine hours: Maintenance Expense Month Machine Hours 1 $ 3,360 2,320 234 2 3,550 2,420 3,730 2,520 3,860 2,550 5 3,860 2,400 6 4,160 2,560 7 3,850 2,540 8 3,660 2,510 9 3,380 2,330 10 3,000 2,200 11 2,900 1,710 12 3,120 2,190 Using the high-low method, total monthly fixed cost is calculated to be (Round final answer to full dollar amount with no decimal places): Multiple Choice

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Sturbridge Company manufactures fine furniture and grandfather clocks. Sturbridge has an excellent reputation, and each grandfather clock sells for several thousand dollars. Which of the following is an indirect cost, assuming the cost object is the Clock Department? Multiple Choice Salary of the clock production supervisor. Depreciation on the factory building. Depreciation on clock-making equipment. All of the answers are correct.