Reggie Wilmore has just started a new business—building and installing custom garage organization systems. Reggie builds the cabinets and work benches in his workshop, then installs them in clients’ garages. Reggie figures his overhead for the coming year will be $12,000. Since his business is labor intensive, he plans to use direct labor hours as his overhead driver. For the coming year, he expects to complete 100 jobs, averaging 25 direct labor hours each. However, he has the capacity to complete 125 jobs averaging 25 direct labor hours each.

1. What source documents will Reggie need to account for costs in his new business?
2. Suppose Reggie’s business grows, and he expands his workshop and hires three additional carpenters to help him. What source documents will he need now?

  • CreatedSeptember 01, 2015
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