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 $28
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:
PROBLEME-20 Eving the Profily of Service LOS4L06-4, LOG-4, 05-6 Gallet Carpet Cleaning is a small, family-owned business operating out of Bosman, Montana. For its services, the company has always charged a flat fee per una pare feet of capital. The current feels 528 per bred quare feel. However, there is some question about whether the company is actually making my money on the forme co-wricularly those located on remoters that pure considerable travel time. The owner's daughter, bee for the same from college has supposed investigating this questioning activity-based conting. After some discussion, she designed a simple system consisting of folvit con pools. The activity cost pooled their activity measures appear below Activity Cost Pool Cleaning carpets Travel to jobs. Job support.. Other (organization-sustaining costs and idle capacity costs) Activity Mensure Square feet cleaned (00s) Miles driven Number of jobs None Activity for the Year 20,000 hundred square foot 60,000 miles 2,000 jobs Not applicable The total cost of operating the company for the year is 430,000, which includes the following contes Wages Cleaning supplies Cleaning equipment depreciation Vehicle expenses Office expenses Presidents compensation Total cost $ 150,000 40.000 20.000 00.000 60,000 10,000 $430,000 Resource comption in distributed me across the activities as follows: Total Distribution of Resource Consumption Across Activities Cleaning Travel Job Carpets to Jobs Support Other 70N 20% 0% 10% 100W O OX OX BO OYN 0% OM 607 0% 40% ON ON 45% 55% 04. O 40 60% Wages Cleaning supplies Cleaning equipment depreciation Vehicle expenses Office expenses President's compensation 20% 100% 100% 100N 1001 100% 100 The total cost of operating the company for the year is 5430,000, which includes the following costs Wages Cloning supplies Cleaning equipment depreciation Vehicle expenses Office expenses Presidents compensation Total cost $ 150,000 40,000 20,000 80.000 80,000 30.000 $430,000 Resource comption is distribed across the activities as follow To Distribution of Resource Consumption ACROSS Activities Cleaning Travel Job Carpet to Job Support Other 70% 2016 TOON OX 80% 20 04 60 40% ON OX 45% 55% 0 ON 40% 60% 10% Wages Cleaning Supplies Cleaning equipment depreciation Vehicle expenses Office expenses President's compensation TOON 8868 100% 100% TOON 100N TOON Jobsupport of moving call from potential to the home offices Willing to Required: Usingle gode prepared first one of the activity cost pools Ling Bab 5.7 guide compute the stivity for the school 1 Therecely complete a foot carpeiden obe Flyg N Rancherining from the company's offices in Compute the cost of the joined based conting system 4 Theme from the Flying N Ranch 5140 (900 square feet 52% de quare feet), 3.12, the current job 5 What do you conting the profitability of the Hing N Roch? Espain 6 What ice would you give the president concerning point in the
