Skoda company makes metal signs for business and residences

Reference no: EM13587877

Skoda Company makes metal signs for business and residences. These signs are made of sheet metal, which the owner paints by hand. The owner is concerned that he does not have a good measure os support costs for the signs. Currently, he predicts support costs to be 30 % of the cost materials. Close investigation of the business reveals that $10 per direct labor hour is a more plausible and reliable support cost measure.

Skoda Company has the following information available:
Small Sign Larger sign
Materials cost $300 $700
Direct labor hours 5 11

1. Using cost of materials as the cost driver, what amount of support costs is assigned to the Small sign?

2. Using cost of materials as the cost driver, what amount of support costs is assigned to the Larger sign?

3. Using direct labor hours as the cost driver, what amount of support costs is assigned to the Small sign?

4. Using direct labor hours as the cost driver, what amount of support costs is assigned to the Larger sing?

Reference no: EM13587877

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