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Mercer Asbestos Removal Company removes potentially toxic asbestos Insulation and related products from bulldings. There has been a long-simmering dispute between the company's estimator and the work supervisors. The on-site supervisors claim that the estimators do not adequately distinguish between routine work, such as removal of asbestos insulation around heating pipes in older homes, and nonroutine work, such as removing asbestos contaminated ceiling plaster In Industrial buildings. The on-site supervisors believe that nonroutine work is far more expensive than routine work and should bear higher customer charges. The estimator sums up his position in this way: "My Job is to measure the area to be cleared of asbestos. As directed by top management, I simply multiply the square footage by $3.00 to determine the bid price. Since our average cost is only $2755 per square foot, that leaves enough cushion to take care of the additional costs of nonroutine work that shows up. Besides, it is difficult to know what is routine or not routine until you actually start tearing things apart To shed light on this controversy, the company Initiated an activity based costing study of all of its costs. Data from the activity based costing system follow. Activity Cout Pool Activity Messung Total Activity Pemoving aubeatos Thousands of square feet 100 thousand square feet stimating and job setup Number of jobs 400 job Working on nonroutine Jaba Number of nonroutine Jobs 100 boncoutine for Other (organimation sustaining costs and None Idle capacity con Note: The 100 nonroutine jobs are included in the total of 400 jobs. Both nonroutine jobs and routine jobs require estimating and setup Cost for the Year Nages and salaries Disposal toes Equipment depreciation Ortoppi Ofrica expenses Licensing and insurance Total coat $ 420,000 314,000 56.000 62.000 320.000 520000 # 2,232,000 Next ntering your answers in the tabs below. Req 1 Req 2 Req 3A to 3C Compute the activity rates for the activity cost pools. Activity Cost Pool Removing asbestos Estimating and job setup Working on nonroutine jobs Activity Rate per thousand square feet per job per nonroutine job var JOD. b. A routine 2,000-square-foot asbestos removal job. c. A nonroutine 2,000-square-foot asbestos removal job. Complete this question by entering your answers in the tabs below. Reg 1 Req 2 Req 3 to 3C Using the activity rates you have cor puted, determine the total cost and the average cost per thousand square feet of each of the following jobs according to the activity-based costing system. (Round the "Average cost per thousand square feet" to 2 decimal places.) a. A routine 1,000-square-foot asbestos removal job. b. A routine 2,000-square-foot asbestos removal job. c. A nonroutine 2,000-square-foot asbestos removal job. Show less Routine 1,000 Routine 2,000 square feet job square feet job Nanroutine 2,000 square feet job Total cost of the job Average Cost per thousand square feet Reg 2