Question

The following information applies to Questions 29 through 34: Company A provides paintings to customers based on their custom orders. Mr. Z has asked A to paint a caricature of his dog. Company A will do so and will charge Mr. Z based on the total costs of the project. For this project, the company used $429 in materials, and 40 hours of an artist's labor. The artist is paid based on a $75 per hour rate. Indirect costs, which include a supervisor's salary, utilities and depreciation for the building, equipment for the artist such as paint brushes and an easel are allocated to customer orders based on the artists' labor hours. The estimated indirect costs for Company A are $240,000 and estimated artists' labor hours are 10,000 hours. The rate that Company A would use to allocate indirect costs would be $ type your answer... per type your answer... (For the "per" response, please spell out the term.) 2 points The following information applies to Questions 29 through 34: Company A provides paintings to customers based on their requests. Mr. Z has asked A to paint a caricature of his dog. Company A will do so and will charge Mr. Z based on the total costs of the project. For this project, the company used $429 in materials, and 40 hours of an artist's labor. The artist is paid based on a $75 per hour rate. Indirect costs, which include a supervisor's salary, utilities and depreciation for the building, equipment for the artist such as paint brushes and an easel are allocated to customer orders based on the artists' labor hours. The estimated indirect costs for Company A are $240,000 and estimated artists' labor hours are 10,000 hours. Assume that the rate per direct labor hour to apply indirect costs to jobs for Company A is $24. The amount of indirect costs applied to Mr. Z's order is $ type your answer...

Answer 1

1.) Answer: The Rate that company A would use to allocate indirect cost is also called Pre- determined overhead Rate. of a Predetermined Overhead Rate is calculated by dividing Indirect costs by Estimated Neember of Base . Here, Base is estimated artist's labour hows ,. So, predetermined Overhead Rate Estimated Indirect costs Estimated artist's labour hours = $240,00 loooo hours = $24 per artist's labour hour.

2.) The rate per direct labour hour to apply indirect cost is $24. So, The amount of Indirect cost applied to Mr. z's order 40 hours X $24 $360

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