Reference no: EM133186058

Question - Cascade Construction Company creates custom-made waterfall landscapes. The firm reports the cost of client contracts using a normal absorption job-order costing system, and previously allocated all overhead on the basis of labor hours. They now calculate separate predetermined overhead rates for design hours and construction hours. For the current year, they projected 14,000 design hours and 37,000 construction hours, which they used to allocate 186,000 of overhead related to design and $591,000 of overhead related to construction.

Indicate the reported overhead allocated to a job that requires 90 design hours and 30 construction hours, under the current accounting system.

Cascade Construction Company creates custom-made waterfall landscapes. The firm reports the cost of client contracts using a normal absorption job-order costing system, and previously allocated all overhead on the basis of labor hours. They now calculate separate predetermined overhead rates for design hours and construction hours. For the current year, they projected 29,000 design hours and 38,000 construction hours, which they used to allocate 119,000 of overhead related to design and $367,000 of overhead related to construction.

Job XYZ requires 70 design hours. How many construction hours must Job XYZ require in order to to guarantee that the job receives the same overhead under the current and previous accounting systems?