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Requirement 1. Compute White Realtors (a) hourly direct labor cost rate and (b) predetermined overhead allocation rate. Begi

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Answer #1

1. $280000/17500 labour hours = $16 per hour

17500 hours × $16 = $280000

Estimated total manufacturing over head cost /estimated total activity base (labour hours)

Direct labour cost = $280000

Office rent. = $310000

Salaries. =$1810000

Utilities = $400000

Total = $2800000

$2800000/17500hours = $160

$280000/2520000 ×100= 11.11%

2. 17500 hours × $16 = $280000

+ 17500 hours × $160= $2800000

Total predicted cost = $3080000

3. $280000 ×30% = 84000

+ 2800000 × 30% = 840000

Required service revenue = 924000

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