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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

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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 hundred square feet of carpet cleaned. The current fee is $22.95 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. Activity Cost Pool Activity Measure Activity for the Year Cleaning carpets Square feet cleaned (ons) 12,000 hundred square feet Travel to jobs Mites driven 120,000 miles Job support Number of jobs 1,900 jobs other organization-sustaining costs and idle capacity costs) None Not applicable The total cost of operating the company for the year is $367,000 which includes the following costs Wages Cleaning supplies Cleaning equipment depreciation Vehicle expenses office expenses President's compensation Total cost $ 136,000 31,000 14,000 35,000 59,000 82 880 Resource consumption is distributed across the activities as follows: Resource consumption is distributed across the activities as follows: Distribution of Resource consumption Across Activities Cleaning Travel to Job Carnets Jobs Support Other Total Wages 741 119 85 15% 1909 Cleaning supplies 100 os os B9 1004 Cleaning equipment depreciation 710 09 09 299 100% Vehicle expenses 0 799 09 214 1004 office expenses ON 08 579 434 100% President's compensation 09 09 655 1001 Job support consists of receiving calls from potential customers at the home office, scheduling Jobs, billing, resolving Issues, and so on. 359 Required: 1. Prepare the first stage allocation of costs to the activity cost pools. 2. Compute the activity rates for the activity cost pools. 3. The company recently completed a 400 square foot carpet-cleaning job at the Flying N Ranch-a 60-mile round-trip Journey from the company's offices in Bozeman Compute the cost of this job using the activity-based costing system. 4. The revenue from the Flying N Ranch was $9180 (400 square feet a $22.95 per hundred square feet). Calculate the customer margin earned on this job. Answer is complete but not entirely correct. margin earned on this job. Answer is complete but not entirely correct. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Required 4 The revenue from the Flying N Ranch was $91.80 (4 hundred square feet $22.95 per hundred square feet). Calculate the customer margineamed on this job, (Negative customer margins should be indicated with a minut sign. Round your Intermediate calculations and final answers to 2 decimal places.) Customer margin $ 1333

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