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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 1.8 hours. On average, HHH completes about 18,000 cleanings per year. The following total costs are associated with the total cleanings:

Direct materials	?
Direct labor	$563,400
Variable overhead	27,000
Fixed overhead	30,600

Next year, HHH expects to purchase $54,200 of direct materials. Projected beginning and ending inventories for direct materials are as follows:

	Direct materials Inventory
Beginning	$3,500
Ending	2,100

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 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
	$fill in the blank 5b0a28f92068075_2
	fill in the blank 5b0a28f92068075_4
	$fill in the blank 5b0a28f92068075_5
	fill in the blank 5b0a28f92068075_7
Direct materials used in production		$fill in the blank 5b0a28f92068075_8
		fill in the blank 5b0a28f92068075_10
		fill in the blank 5b0a28f92068075_12
Total services production costs added		$fill in the blank 5b0a28f92068075_13
		fill in the blank 5b0a28f92068075_15
		fill in the blank 5b0a28f92068075_17
Cost of services produced		$fill in the blank 5b0a28f92068075_18

2. What if HHH planned to purchase $59,100 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 Increase/Decrease By _____

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