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Gore Range Carpet Cleaning is a family-owned business in Eagle-Vail. Colorado. For its services, the company has always charged a flat fee per hundred square
Gore Range Carpet Cleaning is a family-owned business in Eagle-Vail. Colorado. For its services, the company has always charged a flat fee per hundred square feet of carpet cleaned. The current fee is $23.20 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 more 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, a simple system consisting of four activity cost pools seemed to be adequate. The activity cost pools and their activity measures appear below: The total cost of operating the company for the year is $353,000. which includes the following costs: Resource consumption is distributed across the activities as follows: Job support consists of receiving calls from potential customers at the home office, scheduling jobs, billing, resolving issues, and so on. The company recently completed a 6 hundred square-foot carpet-cleaning job at the Lazy Bee Ranch-a 56.00-mile round-trip from the company's offices in Eagle-Vail. Compute the cost of this job using the activity-based costing system. (Round your intermediate and final answers to 2 decimal places.)
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