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 $23 40 per hundred square feet However, there is some question about whether the company is actually making any money on jobs for some customersparticularly those located on remote ranches that require considerable travel time The owners daughter, home for the summer from college, has suggested investigating this question using activity based costing After some discussion, a simple system consisting of four activity cost pools seemed to be adequate The activity cost pools and their activity measures appear below Activity Cost Pool Activity Measure Activity for the year Cleaning Carpets Square Feet Cleaned (00s) 9,000 Hundred Square Feet Travel to Jobs Miles Driven 354,000 Miles Job Support Number of Jobs 1,900 Jobs Other (Costs of Idle capacity and organization sustaining costs None Not Applicable The total cost of operating the company for the year is $352,000, which includes the following costs Wages $136,000 Cleaning Supplies $34,000 Cleaning equipment depriciation $14,000 Vehicle expenses $26 000 Office expenses $61,000 President's Compensation $81,000 Total Cost $352,000 Resource consumption is distributed across the activities as follows Distribution of Resource Consumption Across Activities Cleaning Carpets Travel to Jobs Job Support Other Total Wages 75 16 0 9 100 Cleaning Supplies 100 0 0 0 100 Cleaning Equipment Depriciation 73 0 0 27 100 Vehicle Expense 0 75 0 25 100 Office Expense 0 0 61 39 100 President's compensation 0 0 33 67 100 Job support consists of receiving calls from potential customers at the home office, scheduling jobs, billing, resolving issues, and so on Required 1 Prepare the first stage allocation of costs to the activity cost pools 2 Compute the activity Rates for the activity cost pools (Round your answer to 2 decimal places) 3 The company recently completed a 4 hundred square foot carpet cleaning job at the Flying N rancha 54 00 mile round trip journey from the companys offices in Bozeman Compute the cost of this job using the activity based costing system (Round your intermediate and final answers to 2 decimal places ) 4 The revenue from the Flying N ranch was $93 60 (4 hundred square feet at $23 40 per hundred square feet) Prepare a report showing the margin from this job (Round your intermediate calculations and final answers to 2 decimal places )

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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 fee per

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 $23.40 per hundred square feet. However, there is some question about whether the company is actually making any money on jobs for some customersparticularly those located on remote ranches that require considerable travel time. The owners daughter, home for the summer from college, has suggested investigating this question using activity-based costing. After some discussion, a simple system consisting of four activity cost pools seemed to be adequate. The activity cost pools and their activity measures appear below:

Activity Cost Pool	Activity Measure	Activity for the year
Cleaning Carpets	Square Feet Cleaned (00s)	9,000 Hundred Square Feet
Travel to Jobs	Miles Driven	354,000 Miles
Job Support	Number of Jobs	1,900 Jobs
Other (Costs of Idle capacity and organization-sustaining costs	None	Not Applicable

The total cost of operating the company for the year is $352,000, which includes the following costs:

Wages	$136,000
Cleaning Supplies	$34,000
Cleaning equipment depriciation	$14,000
Vehicle expenses	$26.000
Office expenses	$61,000
President's Compensation	$81,000
Total Cost	$352,000

Resource consumption is distributed across the activities as follows:

Distribution of Resource Consumption Across Activities

	Cleaning Carpets	Travel to Jobs	Job Support	Other	Total
Wages	75%	16%	0%	9%	100%
Cleaning Supplies	100%	0%	0%	0%	100%
Cleaning Equipment Depriciation	73%	0%	0%	27%	100%
Vehicle Expense	0%	75%	0%	25%	100%
Office Expense	0%	0%	61%	39%	100%
President's compensation	0%	0%	33%	67%	100%

Job support consists of receiving calls from potential customers at the home office, scheduling jobs, billing, resolving issues, and so on.

Required:

1. Prepare the first-stage allocation of costs to the activity cost pools.

2. Compute the activity Rates for the activity cost pools. (Round your answer to 2 decimal places)

3. The company recently completed a 4 hundred square foot carpet-cleaning job at the Flying N rancha 54.00-mile round-trip journey from the companys offices in Bozeman. Compute the cost of this job using the activity-based costing system. (Round your intermediate and final answers to 2 decimal places.)

4. The revenue from the Flying N ranch was $93.60 (4 hundred square feet at $23.40 per hundred square feet). Prepare a report showing the margin from this job. (Round your intermediate calculations and final answers to 2 decimal places.)