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Gallatin Carpet Cleaning has always charged a flat fee per hundred square feet of carpet cleaned. The current fee is $13.50 per hundred square feet.

Gallatin Carpet Cleaning has always charged a flat fee per hundred square feet of carpet cleaned. The current fee is $13.50 per hundred square feet. However, there is some question about whether the company is making a profit on jobs requiring considerable travel time. The owners daughter suggested answering this question by designing an activity-based costing system using the information shown below: Activity Cost Pool Activity Measure Activity for the Year Cleaning carpets Square feet cleaned (00s) 8,500 hundred square feet Travel to jobs Miles driven 186,500 miles Job support Number of jobs 2,400 jobs Other (organization-sustaining costs and idle capacity costs) None Not applicable

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