E5-5A. Customer Profitability Analysis HyStandard Services, Inc. provides residential painting services

for three home building companies, Alpine, Blue Ridge, and Pineola, and it uses a job costing system

for determining the costs for completing each job. The job cost system does not capture any cost

incurred by HyStandard for return touchups and refinishes after the homeowner occupies the home.

HyStandard paints each house on a square footage contract price, which includes painting as well as

all refinishes and touchups required after the homes are occupied. Each year, the company generates

about one-third of its total revenues and gross profits from each of the three builders. The HyStandard

owner has observed that the builders, however, require substantially different levels of support follow-

ing the completion of jobs. The following data have been gathered:

Support Activity Driver Cost per Driver Unit

Major refinishes . . . . . . . . . . . . . . . Hours on jobs $60

Touchups . . . . . . . . . . . . . . . . . . . . Number of visits $100

Communication . . . . . . . . . . . . . . . Number of calls $40

Builder: Major Refinishes/ Touchups/ Communication

Alpine . . . . . . . . . . . . 80 150 360

Blue Ridge . . . . . . . . 35 110 205

Pineola . . . . . . . . . . . 42 115 190

Required

Assuming that each of the three customers produces gross profits of $100,000, calculate the profitability

from each builder after taking into account the support activity required for each builder.