Case Study Introduction I'm concerned about the low usage of our Greenfield Hills recreation centre. Many of the residents Apartments: Activity that don't use this facility are complaining about having to bear its costs. We need to Based Costing in a find out what it's costing us to run this Service Setting recreation centre and what it's costing to run the programs there Maybe we should Arnold Schneider* charge for every use of the facility -- but if We do so. we have to know the costs. Abstract -- Mike Plaxer, GHA General Manager This case illustrates the application of In 1989. Springhill Lake Development Corporation built the Greenfield Hills activity-based costing in a service setting - Apartments (GHA) in suburban Milwaukee. a real estate management organisation. Stiments are given costs from an income Wisconsin. It is the largest apartment statement and first need to distribute there complex within a 10-mile radius. GHA was costs to a set of acnvines. Then, costs need designed to attract young professionals, and to be assigned from activities to apartment indeed. in 2004 over three fourths of its resident population was between the ages of windis and a recreation centre. Lastly. to 22 and 40 with a median gross income of determine the costs of various classes within the recreation centre, the recreation approximately $56,000_ Sixty percent of the heads of household were female. GHA centre costs are allocated to the classes. The case demonstrates how multiple stages consists of 20 apartment buildings with a total of 700 units -- 470 two-bedroom of cost assignment are necessary' to arrive apartment homes and 230 one-bedroom at Various costs. apartment homes. In addition. there is an Keywords indoor recreation centre which has a swimming pool, a basketball court, a large exercise room with state-of-the-art Activity Based Costing equipment. two terms counts. one ABC Case Study - Service racquetball court, and two meeting rooms. Cost Allocation GHA has had an average occupancy rate of 85 percent since its opening and currently 1,615 tenants live in the apartment homes. Operations Mike Plaxer was hired in 1997 as General Manager to supervise the daily operations of GHA. Dave Herkovic, the Resident Manager, handles tenants' problems and requests and also shows apartments to prospective tenants. The recreation centre is managed by Steve Bermine, who organises various programs and classes. Bermine also schedules all of the meetings and activities that take place there. Dave Franks is the buildings and grounds supervisor. He is m charge of the maintenance workers, groundskeepers, and custodians. Aside from cleaning the recreation centre and apartments that are vacated, the custodians also provide cleaning services to tenants Georgia Institute of Technology who pay a "maid service" fee. Colleen