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 $22.70 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: oints Activity Cost Pool Cleaning carpets Travel to jobs Job support Other (organization-sustaining costs and Activity Measure Square feet clea Miles driven Number of jobs Activity for the Year 10,000 hundred square feet 201,500 miles ned (00s) eBook Print References 1,700 jobs idle capacity costs) None Not applicable The total cost of operating the company for the year is $365,000 which includes the following costs: Wages Cleaning supplies Cleaning equipment depreciation Vehicle expenses Office expenses President's compensation Total cost 137,000 34,000 19,000 36,000 63,000 76,000 $ 365,000 Resource consumption is distributed across the activities as follows