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    Overhead cost

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    A Co recently received an order from a potential customer outside the Co. normal geographic service region for a price of $9,000. The size of the proposed job is 22,000 square feet. The Co. normal service costs are as follows:
    Unit level materials $0.18 per square foot
    Unit Level Labor $0.25 per square foot
    Unit Level variable overhead $0.08 per square foot
    Facility level overhead Allocated at $0.10 per square foot
    If the Co. accepts this offer: a) will the Co $4,420 on the job; b) Lose 2,220 on the job c) lose $460 on the job d) Earn $5,040. Not sure how to set up the formula to get the correct answer.

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    Solution Preview

    Total relevant cost= (Unit level materials + Unit Level Labor + ...

    Solution Summary

    Solution describes how to to calculate profit or loss on the job under job costing.