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Brookside Property Management is a property management service company for small shopping malls that uses ABC to estimate costs for pricing and other purposes. The

Brookside Property Management is a property management service company for small shopping malls that uses ABC to estimate costs for pricing and other purposes. The owner of the company believes that costs are driven primarily by the area of outdoor maintenance (parking lots, sidewalks, and gardens), the area of indoor tenant space in the shopping mall, the distance to travel to the shopping mall, and the number of shopping malls managed. In addition, the costs of managing the indoor tenant space depend on whether the tenants are located on the main level or other levels of the mall. Accordingly, the company uses the five activity cost pools listed below:

Activity Cost Pool Activity Measure
Management of outdoor areas Square metres of outdoor areas
Management of indoor mall spacemain level Square metres of main level mall space
Management of indoor mall spaceother levels Square metres of nonmain level mall space
Travel to jobs Kilometres
Customer billing and service Number of shopping malls

The company has already carried out its first-stage allocations of costs. The companys annual costs and activities are summarized as follows:

Activity Cost Pool Estimated Overhead Cost Expected Activity
Management of outdoor areas $ 69,850 127,000 square metres of outdoor areas
Management of indoor mall spacemain level $ 114,400 104,000 square metres of main level mall space
Management of indoor mall spaceother levels $ 307,500 246,000 square metres of nonmain level mall space
Travel to jobs $ 6,600 22,000 kilometres
Customer billing and service $ 13,800 8 shopping malls

Parker Hills Shopping Mall is one of Brooksides oldest clients. Details concerning the malls layout, outdoor space, and distance from Brooksides head office are as follows:

Activity Cost Pool Total Activity for Parker Hills Mall
Management of outdoor areas 16,000 square metres of outdoor areas
Management of indoor mall spacemain level 25,000 square metres of main level mall space
Management of indoor mall spaceother levels 0 as mall only has one level
Travel to jobs 2,500 kilometres travelled
Customer billing and service 1 shopping malls

Required:

1. Compute the activity rate for each of the activity cost pools. (Round your answers to 2 decimal places.)

2. Determine the total overhead cost that would be assigned to the Parker Hills Shopping Mall using the ABC system. (Round your answers to 2 decimal places.)

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