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Green Thumb Gardening is a small gardening service that uses activity - based costing to estimate costs for pricing and other purposes. Green Thumb Gardening

Green Thumb Gardening is a small gardening service that uses activity-based costing to estimate costs for pricing and other purposes. Green Thumb Gardening is a small gardening service that uses activity-based costing to estimate costs for pricing and other purposes. The proprietor of the company believes that costs are driven primarily by the size of customer lawns, the size of customer garden beds, the distance to travel to customers, and the number of customers. In addition, the costs of maintaining garden beds depend on whether the beds are low maintenance beds (mainly ordinary trees and shrubs) or high maintenance beds (mainly flowers and exotic plants). Accordingly, the company uses the five activity cost pools listed below: The company already has completed its first stage allocations of costs and has summarized its annual costs and activity as follows: Activity cost pool, $72,000, caring for garden beds low maintenance $26,400, caring for garden beds high maintenance $41,400, travel to jobs $3250, customer billing and service $8750. Expected activity 150,000 square feet of lawn, 20,000 square feet of low maintenance beds, 15,000 square feet of high maintenance beds, 12,500 square miles, and 25 customers. Compute the activity rate for each of the activity cost pools.

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