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Pani-rosa [81]
3 years ago
7

E&J Auto Body Shop estimated overhead cost for the coming year will be $15,000 and 5,000 direct labor hours will be worked.

The amount of overhead cost applied by E&J Auto Body Shop to one of its jobs, if the jobs required 10 direct labors hours to complete, would be :_______
a. $150
b. $ 30
c. $ 50
d. $ 15
Business
1 answer:
kondor19780726 [428]3 years ago
8 0

Answer:

correct option is b. $ 30

Explanation:

given data

overhead cost = $15,000

direct labor hours = 5,000

required direct labors hours = 10

solution

we get here Fixed Overhead Rate that is

Fixed Overhead Rate = estimated overhead cost ÷ direct labor hours ........1

Fixed Overhead Rate = \frac{15000}{5000}  

Fixed Overhead Rate = $3 per labor hour

and

Job overhead applied express as

overhead = Fixed Overhead Rate  × required direct labors hours  ..........2

overhead  = $3 × 10

overhead = $30

so correct option is b. $ 30

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Sales grow before any new fixed assets are needed is $156,480.

Fixed assets , additionally known as lengthy-lived assets or property, plant, and equipment, are a time period utilized in accounting for belongings and belongings that cannot without difficulty be converted into cash. fixed properties are one of a kind from modern assets, along with coins or bank accounts, due to the fact the latter is liquid belongings.

currently operating = 94 percent

current sales = $740,000

Full capacity sales = current sales/ Current capacity utilisation

                               = 500000/0.94

                               = $531,914.89

Percentage of fixed assets to full Capacity Sales = Fixed Assets / full Capacity Sales

                                                                                 = 400000/531914.89

                                                                                 = 0.752

Total Fixed assets Needed for New Sales = 74000*0.752

                                                                      = 556480

Additional Fixed Assets needed = 556480 - 400000

                                                      = $156,480   answer.

Learn more about fixed assets here:-brainly.com/question/25746199

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In accounting for a contingent liability, if the likelihood of the obligation is probable but the amount cannot be estimated, a
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A contingent liability is an obligation that a company might owe in future depending on the outcome of an event such as a law suit.

To record a contingent liability in the books, two conditions must be satisfied;

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If these two conditions are not satisfied then the contingent liability may simply be disclosed as a footnote in the financial statement. The amount here is not estimable so can be disclosed as a footnote.

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