Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Galiotin Carpet Cleaning is a small family owned business operating out of Bozeman, Montana. For its services, the company has always charged a tot tee

image text in transcribed
image text in transcribed
Galiotin Carpet Cleaning is a small family owned business operating out of Bozeman, Montana. For its services, the company has always charged a tot tee per hundred square feet of carpet cleaned. The current fee is $22.30 per hundred square feet. However, there is some question about whether the company is actually making any money on jobs for some customers particularly those located on remote anches that require considerable travel time. The owner's daughter, home for the summer from college, has suggested investigating this question using activity-based costing. After some discussion, she designed a simple system consisting of four activity cost pools. The activity cost pools and their activity measures appear below: Activity measure Rtivity for that voor Che carpets Square foot cleaned (05) 14,500 undred suare feet Riles de 24.000 miles Je support umber of jobs 2,000 Jobs Other Companies and capacity Tot applicable The total cost of operating the company for the year is $357,000 which includes the following costs 1 149.000 cleaning soli Cleaning pot depreciation whicle expenses de pe President's comensation Total cost 11 35.000 67. TO 5. peri Resource conturon dibuted across the activities as follows: Travel Car do Sport Other 11 pes Clewing Total 1000 1001 100% 2 relation 100% 100% Job support consists of receiving calls from potential customers at the home office, scheduling Jobs, billing, recoming issues, and so on Required Prepare the first stage location of costs to the activity cost pools 2. Compute the activity rates for the activity Cost pools 2. The company recently completed a 400 square foot carpet-cleaning job at the Flying N Ronch 54 mile round-trip jaumey from the company's offices in Bozeman Compute the cost of this job using the activity based couting system The revenue from the Fying N Ranch was $89 20400 square foot $22.30 per hundred square foot Calculate the customer margineamed on this job Complete this question by entering your answers in the tabs belom. Requr Press the first

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

The Law And Economics Of Patent Damages, Antitrust, And Legal Process

Authors: James Langenfeld, Frank Fagan, Samuel Clark

2nd Edition

1800710259, 9781800710252

More Books

Students also viewed these Accounting questions

Question

5 Name at least three recruitment methods.

Answered: 1 week ago