Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

how to calculate To shed light on this controversy, the company initiated an activity-based costing study of all of its costs. Data from the activity-based

image text in transcribed
image text in transcribed
how to calculate
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 Cost Pool Activity Measure Total Activity Removing asbestos Thousands of square feet 800 thousand square feet Estimating and job setup Number of jobs 500 jobs Working on nonroutine jobs Number of nonroutine jobs 100 nonroutine jobs Other (organization-sustaining costs and idle capacity costs) None Note: The 100 nonroutine jobs are included in the total of 500 jobs. Both nonroutine jobs and routine jobs require estimating and setup. Costs for the Year Wages and salaries Disposal fees Equipment depreciation On-site supplies Office expenses Licensing and insurance Total cost $ 300,000 700,000 90,000 50,000 200.000 400,000 $ 1,740,000 Distribution of Resource Consumption across Activities Estimating Working on Removing and Job Nonroutine Asbestos Setup Jobs Wages and salaries 100 30 Disposal fees 608 408 Equipment depreciation 408 208 108 On-site supplies office expenses 108 356 258 500 Licensing and insurance 508 Other 10 08 356 Total 1000 1008 1000 1000 1000 1000 608 30% 08 308 200 308 06 Req 1 Reg 2 Reg 3A to 3C Using the activity rates you have computed, 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 A Routine 1,000 sq. ft. Job $ 1,209 1.209.00 Routine Nonroutine 2,000 sq. 2,000 sq. ft. ft. Job job $ 1,090 $ 4,305 $ 1,090.00 $ 4,305.00 Total cost of the job Average Cost per thousand square feet

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Financial Accounting For Decision Makers

Authors: Peter Atrill, Eddie McLaney

9th Edition

1292251255, 9781292251257

More Books

Students also viewed these Accounting questions