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  • Cost and Quuoted Price of GC & Ex Using Labour Hours

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    Accounting Mania
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    The document compares the cost and quoted price of two construction projects (GC and EX) using traditional labor hour-based costing versus activity-based costing. Under traditional costing, the GC project costs $11,000 to complete with a required profit of $5,500, for a quoted price of $16,500. For EX, the costs are $20,500, required profit of $10,250, and quoted price of $30,750. Under activity-based costing, overhead costs are allocated based on activities and cost drivers, resulting in higher estimated total costs and quoted prices for both projects.

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    question of costing

    Original Title

    Question # 2

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    The document compares the cost and quoted price of two construction projects (GC and EX) using traditional labor hour-based costing versus activity-based costing. Under traditional costing, the GC project costs $11,000 to complete with a required profit of $5,500, for a quoted price of $16,500. For EX, the costs are $20,500, required profit of $10,250, and quoted price of $30,750. Under activity-based costing, overhead costs are allocated based on activities and cost drivers, resulting in higher estimated total costs and quoted prices for both projects.

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    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
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    1 views2 pages

    Cost and Quuoted Price of GC & Ex Using Labour Hours

    Uploaded by

    Accounting Mania
    The document compares the cost and quoted price of two construction projects (GC and EX) using traditional labor hour-based costing versus activity-based costing. Under traditional costing, the GC project costs $11,000 to complete with a required profit of $5,500, for a quoted price of $16,500. For EX, the costs are $20,500, required profit of $10,250, and quoted price of $30,750. Under activity-based costing, overhead costs are allocated based on activities and cost drivers, resulting in higher estimated total costs and quoted prices for both projects.

    Copyright:

    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
    Flag for inappropriate content
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    Cost and Quuoted Price of GC & Ex using Labour Hours

    GC EX
    Material $3,500 $8,000
    Labour 4500 $7,500
    Overheads 3000 5000
    hours
    Cost $11,000 $20,500

    Required Profit $5,500 $10,250

    Quoted Price $16,500 $30,750

    Cost and Quoted Price of GC & EX using ABC Costing


    GC EX
    Material 3500 8000
    Labour 4500 7500
    Overheads 3500 8000

    Cost 11500 23500

    Required Profit 5750 11750

    Quoted Price 17250 35250


    Hours
    Working for Overheads

    GC EX Budgeted OH 400000
    300 500 Total Hours 40000

    OAR 10

    Working for Overheads

    Activity-Cost driver Activity Based Rate GC EX


    Supervisor-Site Visits 180 180 1080
    Planners-Planning documents 280 280 1400
    Property related-Labour hours 6 1800 3000

    Total 2260 5480

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