ercer Asbestos Removal Company removes potentially toxic asbestos insulation and related products from buildings. There has een a long simmering dispute between the company's estimator and the work supervisors. The on-site supervisors claim that the Etimators do not adequately distinguish between routine work, such as removal of asbestos insulation around heating pipes in older omes, and nonroutine work, such as removing asbestos-contaminated ceiling plaster in industrial buildings. The on-site supervisors elieve that nonroutine work is far more expensive than routine work and should bear higher customer charges. The estimator sums his position in this way: "My job is to measure the area to be cleared of asbestos. As directed by top management. I simply multiply me square footage by $250 to determine the bid price. Since our average cost is only $2.01 per square foot, that leaves enough ishion to take care of the additional costs of nonroutine work that shows up. Besides, it is difficult to know what is routine or not outine until you actually start tearing things apart shed light on this controversy, the company initiated an activity-based costing study of all of its costs. Data from the activity-based osting system follow Activity: Cost Pool Activity Measure Total Activity Removing asbestos Thousands of square feet 850 thousand square feet Estimating and job setup Number of jobs 400 Jobs Working on noroutine jobs Number of nonroutine Jobs 100 nonroutine Jobs Other (organization-sustaining costs and Idle capacity costs) None Note: The 100 nonroutine jobs are included in the total of 400 jobs. Both nonroutine jobs and routine jobs require estimating and eetup Costs for the Year Hages and salaries Disposal fees Equipment depreciation On-site supplies office expenses Licensing and insurance Total cost 5 308,000 786,600 90,000 50.000 210,000 410,089 $ 1,774,000 Distribution Resource Constien Arms Activities PUOL Activity Measure Total Activity Removing asbestos Thousands of square feet 850 thousand square feet Estimating and job setup Number of fobs 400 jobs Working on nonroutine jobs Number of nonroutine jobs 100 nonroutine jobs Other (organization-sustaining costs and Lale capacity costs) None Note: The 100 nonroutine jobs are included in the total of 400 jobs. Both nonroutine jobs and routine jobs require estimating and setup Costs for the Year Wages and salaries Disposal fees Equipment depreciation On site supplies Office expenses Licensing and Insurance Total cost $ 300,000 706,000 90,000 se,000 210,000 410,000 $ 1,774,000 18% 100% 30x 10 Distribution of Resource Consumption Across Activities Estimating Working on Removing and Job Nonroutine Asbestos Setup Jobs Wages and salaries Other Total tex 20% tex Disposal fees 70% B 3ex 0% Equipment depreciation 100 40% 5% 25% On-site supplies 70% 20 18% Office expenses ex 100% 15% 35% 203 30% Licensing and insurance 100% 25% 0% sex 25% 106 Required: 1. Perform the first stage allocation of costs to the activity cost pools 2. Compute the activity rates for the activity cost pools 3. Using the activity rates you have computed, determine the total cost and the average cost per thousand square feet of each of the following jobs according to the activity-based costing system A tutina 10 1 Perform the first stage allocation of costs to the activity cost pools. 2. Compute the activity rates for the activity cost pools 3. Using the activity rates you have computed, determine the total cost and the average cost per thousand square feet of each oft following jobs according to the activity-based costing system a. A routine 1,000-square-foot asbestos removal job, b. A routine 2,000 square foot asbestos removal job. c. Anonroutine 2.000 square foot asbestos removal job. Complete this question by entering your answers in the tabs below. Reg Reg 2 Reg 3A to 3C Perform the first stage allocation of costs to the activity cost pools. Removing asbestos Estimating and Job Setup Working on Nontoutine Jobs Other Total $ 0 0 0 Wages and salaries Disposal fees Equipment depreciation On site supplies Ofice expenses Licensing and insurance Total cost role 0 $ 0 $ of $ Os 0 quired: erform the first stage allocation of costs to the activity cost pools. Compute the activity rates for the activity cost pools. Using the activity rates you have computed determine the total cost and the average cost per thousand square feet of each of lowing jobs according to the activity-based costing system. A routine 1000-square-foot asbestos removal job. A routne 2.000-square-foot asbestos removal job. A nonroutine 2,000-square foot asbestos removal job. Complete this question by entering your answers in the tabs below. Red 1 Reg 2 Reg 3A to 3C Compute the activity rates for the activity cost pools. Activity Cost Pool Removing asbestos Estimating and job setup Working on nonroutine jobs Activity Rate per thousand square feet per Job per nonroutine job RO compute the actvity rates for the activity cost pools 3. Using the activity rates you have computed determine the total cost and the average cost per thousand square feet of eac following jobs according to the activity-based costing system a. A routine 1,000-square-foot asbestos removal job. b. A routine 2.000-square foot asbestos removal job c. A nonroutine 2,000-square-foot asbestos removal job. Complete this question by entering your answers in the tabs below. Reg 1 Reg 2 ReQ 3A 3C Using the activity rates you have computed, determine the total cost and the average cost per thousand square feet of each of the following jobs according to the activity-based costing system. (Round the "Average Cost par thousand square feet to 2 decimal places.) a. A routine 1,000-square-foot asbestos removal job. b. A routine 2,000-square-foot asbestos removal job. c. A nonroutine 2,000-square-foot asbestos removal job. Show less Routine 1.000 Routine 2.000 square feet job square feet job Nonroutine 2,000 square feet job Total cost of the job Average Cost per thousand square feet