Answered step by step
Verified Expert Solution
Question
1 Approved Answer
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
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 hundred square 9,000 feet 387,500 miles 1,700 jobs None Not applicable The total cost of operating the company for the year is $372,000 which includes the following costs: Wages $149,000 Cleaning supplies 35,000 Cleaning equipment depreciation 17,000 Vehicle expenses 28,000 Office expenses 69,000 President's compensation__74,000 Total cost $372,000 Resource consumption is distributed across the activities as follows: Distribution of Resource Consumption Across Activities Travel Cleaning to Job Carpets Jobs Support Other Wages 72% 10% 0% 18% Cleaning supplies 100% 0% 0% 0% Cleaning equipment depreciation 74% 0% 0% 26% Vehicle expenses 0% 79% 0% 21% Office expenses 0% 0% 56% 44% President's compensation 0% 0% 30% 70% Total 100% 100% 100% 100% 100% 100% Job support consists of receiving calls from potential customers at the home office, scheduling jobs, billing, resolving issues, and so on. Required: 1. Prepare the first stage allocation of costs to the activity cost pools. 2. Compute the activity rates for the activity cost pools. 3. The company recently completed a 200 square foot carpet-cleaning job at the Flying N Ranch-a 55-mile round-trip journey from the company's offices in Bozeman. Compute the cost of this job using the activity-based costing system. 4. The revenue from the Flying N Ranch was $47.40 (200 square feet @ $23.70 per hundred square feet). Calculate the customer margin earned on this job. Complete this question by entering your answers in the tabs below. Required Required Required Required 1 2 3 4 Prepare the first-stage allocation of costs to the activity cost pools. Job Cleaning Travel to Carpets Jobs Other Total Support $ 0 0 Wages Cleaning supplies Cleaning equipment depreciation Vehicle expenses Office expenses President's compensation Total cost 0 $ o $ 0 $ 0 $ 0 $ 0
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started