3. The company recently completed a 200 square foot carpet-cleaning job at the Flying N Rancha 57-mile round-trip journey from the companys offices in Bozeman. cost of this job

4. The revenue from the Flying N Ranch was $46.50 (200 square feet @ $23.25 per hundred square feet). customer margin

1	Cleaning Carpets	Travel to Jobs	Job Supp	Other	Total
Wages	113190.00	19110.00	0.00	14700.00	147000.00
Cleaning Supplies	26000.00	0.00	0.00	0.00	26000.00
Cleaning Equi	11840.00	0.00	0.00	4160.00	16000.00
Vehicle	0.00	24000.00	0.00	6000.00	30000.00
Office	0.00	0.00	37950.00	31050.00	69000.00
Presd Comp	0.00	0.00	21600.00	50400.00	72000.00
Total	151030.00	43110.00	59550.00	106310.00	360000.00
2	Exp OH	Exp Actv	Actvy Rate
Actv Cost Pool
Cleaning Carpet	151030.00	13500.00	11.19
Travel to Jobs	43110.00	173500.00	0.25
Job Support	59550.00	1900.00	31.34
	253690.00

3
Job	Usage Actvy	Actvy Rate	Applied Cost
Cleaning Carpet	200.00	11.19	2237.48
Travel To Job	57.00	0.25	14.16
Job Support	1.00	31.34	31.34
		XX Incorrect	2282.99
4
Revenue	46.50
Cost Of Job	11.41
Cust Margin	57.91	XX Incorrect

Gallatin Carpet Cleaning is a small, family-owned business operating out of Bozeman, Montana. For its services, the company has always charged a flat fee per hundred square feet of carpet cleaned. The current fee is $23.25 per hundred square feet. However, there is some question about whether the company is actually making any money on jobs for some customers-particularly those located on remote ranches that require considerable travel time. The owner's daughter, home for the summer from college, has suggested investigating this question using activity-based costing. After some discussion, she designed a simple system consisting of four activity cost pools. The activity cost pools and their activity measures appear below: Activity Cost Pool Cleaning carpets Travel to jobs Job support Other (organization-sustaining costs and idle capacity costs) Activity Measure Square feet cleaned (00s) Miles driven Number of jobs Activity for the Year 13,500 hundred square feet 173,500 miles 1,900 jobs None Not applicable The total cost of operating the company for the year is $360,000 which includes the following costs: Wages Cleaning supplies Cleaning equipment depreciation Vehicle expenses office expenses President's compensation Total cost $ 147,000 26,000 16,000 30,000 69,000 72,000 $ 360,000 Resource consumption is distributed across the activities as follows: Wages Distribution of Resource consumption Across Activities Cleaning Travel Carpets to Jobs 77% 13% Cleaning supplies 100% 0% Cleaning equipment depreciation 74% 0% Vehicle expenses 0% 80% Office expenses 0% 0% President's compensation 0% 0% Job Support 0% %% 0% 0% 55% 30% Other 10% 0% 26% 20% 45% 70% Total 100% 100% 100% 100% 100% 100%