Road Runner Engine Shop uses a job order cost system to determine the cost of performing engine

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Road Runner Engine Shop uses a job order cost system to determine the cost of performing engine repair work. Estimated costs and expenses for the coming period are as follows:

Engine parts ................................................. $ 810,000

Shop direct labor ............................................ 770,000

Shop and repair equipment depreciation ..... 64,000

Shop supervisor salaries ................................ 212,000

Shop property taxes ......................................... 35,000

Shop supplies .................................................... 18,000

Advertising expense ......................................... 44,000

Administrative office salaries .......................... 73,400

Administrative office depreciation expense .. 12,000

Total costs and expenses ......................... $2,038,000

The average shop direct labor rate is $22 per hour. Determine the predetermined shop overhead rate per direct labor hour.

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Related Book For  answer-question

Accounting

ISBN: 9781337902687

28th Edition

Authors: Carl S. Warren, Christine Jonick, Jennifer Schneider

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