Prepare a statement of cost of services sold in good form

Reference no: EM13901114

Jean and Tom Perritz own and manage Happy Home Helpers Inc. (HHH), a housecleaning service. Each cleaning (cleaning one house one time) takes a team of threehouse cleaners about 1.5 hours. On average, HHH completes about 15,000 cleaningsper year. The following total costs are associated with the total cleanings:

Direct Materials	$ 27,000
Direct Labor	472,500
Variable Overhead	15,000
Fixed overhead	18,000

Next year, HHH expects to purchase $25,600 of direct materials. Projected beginningand ending inventories for direct materials are as follows:

	Direct Materials Inventory
Beginning	$4,000
Ending	2,600

There is no work-in-process inventory; in other words, a cleaning is started and completed on the same day.

Required:

1. Prepare a statement of cost of services sold in good form.

2. How does this cost of services sold statement differ from the cost of goods sold statement for a manufacturing firm?

Reference no: EM13901114

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