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 $22.55 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:

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Activity Cost Pool Cleaning carpets Travel to jobs Job support Other (costs of idle capacity and Activity Measure Activity for the Year 7,000 hundred square feet Square feet cleaned (00s) Miles driven Number of jobs 417,500 miles 1,800 jobs 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 Cleaning supplies Cleaning equipment depreciation Vehicle expenses Office expenses President's compensation $143,000 24,000 15,000 25,000 68,000 77,000 Total cost $ 352,000 Resource consumption is distributed across the activities as follows Distribution of Resource Consumption Across Activities Cleaning Travel to Job Total 100% 100% 100% 100% 100% 100% Carpets Jobs Support Other Wages Cleaning supplies Cleaning equipment depreciation Vehicle expenses Office expenses President's compensation 13% 0% 0% 80% 0% 0% 0% 0% 0% 0% 65% 25% 16% 0% 29% 20% 35% 75% 71% 100% 0% 0% 0% Job support consists of receiving calls from potential customers at the home office, scheduling jobs, billing, resolving issues, and so on