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Gallatin Carpet Cleaning is a small, family - owned business operating out of Bozeman, Montana. For its services, the company has always charged a flat

Gallatin Carpet Cleaning is a small, family-owned business operating out of Bozeman, Montana. For its services, the company has
always charged a flat fee per hundred square feet of carpet cleaned. The current fee is $24.00 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 ranches 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:
The total cost of operating the company for the year is $372,000 which includes the following costs:
Resource consumption is distributed across the activities as follows:
Job support consists of receiving calls from potential customers at the home office, scheduling jobs, billing, resolving issues, and so
on.
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