The management of Duratech Company wishes to secure greater control over service departments and decides to create
Question:
Required:
(1) Compute the billing rate for each department.
(2) Compute variances for each department for September.
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Maintenance Department Predetermined data (beginning of the month) Normal level of maintenance hours per month Average hourly rate for maintenance worker 3,200 $8.70 Fixed Cost per Month Variable Cost per Maintenance Hour Other maintenance costs: Supervision $9,800 2,300 700 $.50 75 05 Tools and supplies Other miscellaneous items Actual data (end of the month) Maintenance hours worked Maintenance workers' earnings Other costs (supervision, etc.) 3,355 $29,610 $17,590 Payroll Department Predetermined data (beginning of the month) Average number of employees in factory and office. Budgeted cost for department 1,200 $12,000 plus $2 for each employee in factory and office Actual data (end of the month): Number of employees in factory and office.. Total cost in the Payroll Depar 1.165 $13,875
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