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all parts Gallatin Capet Cleaning is a small, fanily-owned business operating out of Bozeman, Montana for its services, the company has olWays charged in fint
all parts Gallatin Capet Cleaning is a small, fanily-owned business operating out of Bozeman, Montana for its services, the company has olWays charged in fint fee per handred square feet of carpet cleaned. The curtent fee is 52395 per hundred square feet Howeree there is some quection obout whether the company is actually making any money on jobs for sorme customers-porticulany those loceted on remote ranches that requile considerable travel time. The owner's douglitet, home for the summer from colkege, hos suggested imestioating this question using activity bosed costing. After some discussion, she designed simple syztem consisting of fout sctivity cort poois. the activity cost pools and their activity measures appent below. The total cost of operating the company for the yeat is $361,000 which includes the loliowing costs: Resource consumption is distributed ocross the activities as follows: Job support consists of ieceiving cais from potential customers at the home office. scheduling jobs, biling, resolving issues. and so on. Requlred: 1. Prepere the firt stage ofocation of costs to the activity cost pools. 2 Compute the sctivity rates for the activity cost pools. 3. The compony recertly completed a 400 squate foor carpet-cieaning job ot the Flying N Ranch-a 60 -ilie round-rip joumey from the companys offices in Boseman. Compute the cost of this job using the activity bused costing system. 4. The revenue from the Flying N Ranch wos 595.80 for 1400 square feet of 523.95 per hundred souare feeti. Caiculate the custonter margin earned on this job. Complete this question bvertering your answers in the tabs below. Prepere the firit-stage allocuten of costa to the activity cont pooly
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