Cost of Services Produced

Jean and Tom Perritz own and manage Happy Home Helpers, Inc. $($HHH$),$ a house$-$cleaning service. Each cleaning $($cleaning one house one time$)$ takes a team of three house cleaners about $1\mathrm{.}5$ hours. On average, HHH completes about $15,000$ cleanings per year. The following total costs are associated with the total cleanings:

Direct materials $?$

Direct labor $$472,500$

Variable overhead $15,000$

Fixed overhead $18,000$

Next year, HHH expects to purchase $$25,600$ of direct materials. Projected beginning and 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:

Question Content Area

$1.$ Prepare a statement of services produced in good form. If an amount is zero, enter $"0".$

Happy Home Helpers, Inc.

Statement of Cost of Services Produced

For the Coming Year

Direct materials

$Beginning inventory

Add: Purchases

Materials available $fill in the blank $35$f$2$cbfd$1$fcb$031\_5$

Less: Ending inventory

Direct materials used in production $fill in the blank $35$f$2$cbfd$1$fcb$031\_8$

Direct labor

Cleaning overhead

Total services production costs added $fill in the blank $35$f$2$cbfd$1$fcb$031\_13$

Add: Beginning work in process

Less: Ending work in process

Cost of services produced $fill in the blank $35$f$2$cbfd$1$fcb$031\_18$

Question Content Area

$2.$ What if HHH planned to purchase $$30,000$ of direct materials? Assume there would be no change in beginning and ending inventories of materials. What effect would this have on cost of services produced?

Cost of services produced would

by $fill in the blank $8$d$7$ec$4$fc$2$febff$4\_2$

Feedback AreaCost of Services Produced

with the total cleanings:

Next year, $HHH$ expects to purchase $$25,600$ of direct materials. Projected beginning and 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:

Prepare a statement of services produced in good form. If an amount is zero, enter $"0".$

Happy Home Helpers, Inc.

Statement of Cost of Services Produced

For the Coming Year

Direct materials