Bundy Car Mechanic Inc.uses a job-order costing system. The company applies all of its overhead...
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Accounting
Bundy Car Mechanic Inc.uses a job-order costing system. The company applies all of its overhead costs to jobs using a predetermined overhead ratebased on direct labor-hours. At the beginning of the year, it made the following estimates:
Direct labor-hours required to support estimated output30,000Fixed overhead cost$405,000Variable overhead cost per direct labor-hour$1.00
During the year, a customer brought in her car for repairs. The following information was available with respect to the car's repairs:
Direct materials$619Direct labor cost$113Direct labor-hours used4
If Bundy sets its selling prices by adding a markup percentage of 40% of its total job cost, then how much would Bundy have charged this customer for her car's repairs?
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