At the end of 2011, Morgan Company had two jobs still in process with a total balance of $2,500. According to the respective job cost sheets the jobs had $600 and $650 in direct materials costs and $200 and $50 in direct labor costs. What overhead rate is Morgan using?
A. 25% of direct labor costs.
B. 50% of direct material costs.
C. 10% of direct labor costs.
D. 80% of direct material costs.
Sweet Shoppe Creamery incurred the following costs: $800 of ice cream, 60 hours of direct labor at $9 per hour, $80 for indirect materials, $40 for indirect labor, $200 for product advertising, and $150 of administrative costs. How much are total product costs?
For make-or-buy decisions, which items are always relevant?
The solution answers Management accounting questions: Morgan Co, Sweet Shoppe Creamery, make-buy decisions.