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Allocating costs among products

Bryson Construction Company expects to build three new homes during a specific accounting period. The estimated direct materials and labor costs are as follows.

Expected Costs	Home 1	Home 2	Home 3
Direct labor	$ 60,000	$ 89,000	$196,000
Direct materials	182,000	247,000	380,000

Assume Bryson needs to allocate two major overhead costs ($41,400 of employee fringe benefits and $40,450 of indirect materials costs) among the three jobs.

Required

Choose an appropriate cost driver for each of the overhead costs and determine the total cost of each home.

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M91885075

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