Question E - Sample costing flows and pricing for three customers (10 marks) Box D Customer 3 + Material + Labour + Mfg. Overhead + Corp Overhead + Mark up - Fixed Price Box A Customer 1 + Material + Labour + Mfg. Overhead + Corp Overhead + Mark up Floating Price Box C Actual Customer 2 Material to-date +Labour to date +Mfg. Overhead Corp Overhead Costs to date Box C Forecast Customer 2 + Material + Labour Mig Overhead Corp Overhead + Mark up - Fixed Price Answer: 1. What type of costing system is illustrated above on this page? 2. What is a potential issue with Customer 2 if labour costs are based on a budget and actual results means the allocation should have been higher. 3. True and False questions - Indicate True or False True False Question A. Factory (Mfg) overhead includes all manufacturing costs except direct materials and direct labour and is allocated based on overall direct labour hours worked. States True False Question A. Factory (Mfg) overhead includes all manufacturing costs except direct materials and direct labour and is allocated based on overall direct labour hours worked. B. Labour in the Customer Boxes above (this page) are based on specific labour rates and hours worked on the particular job. C. Materials are tracked through a requisition system. D. Factory overhead applied represents the actual overhead costs incurred for the particular job. In Box A, this is the actual Mfg overhead incurred E. Material, Labour Costs, and Mig Overhead in the Boxes above on this page would be recorded in Cost of Goods Sold when a sale is realized. F. A job costing system is not applicable for a service company. G. The mark-up (e. profit) in the Box Dis 20% of costs. If the manufacturing costs are $75,000 and corporate overhead is $25,000, the profit to the company is A = $20,000 or B = $15,000. Which is correct? H. Labour hours are tracked through a time ticket system. If the labour component of costs in G just above unexpectedly increased and manufacturing costs are now $80,000, the company would A= increase its profits or B = decrease its profits. Which is correct? B B