Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

just answers needed thank you Gallatin Carpet Cleaning is a small, family-owned business operating out of Bozeman, Montana. For its services, the company has always

just answers needed thank you
image text in transcribed
image text in transcribed
image text in transcribed
image text in transcribed
image text in transcribed
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 $23.35 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: Activity cont Pool Activity Meanure Activity for the Year Cleaning carpets square feet cleaned (005) 9,000 hundred square feet Travel to joba Miles driven 340,500 miles Job nupport Number of jobs 1,800 Jobs other organisation-sustaining conts and Idle capacity costs) None Not applicable The total cost of operating the company for the year is $365,000 which includes the following costs: Wagen $ 149,000 cleaning supplies 34.000 Cleaning equipment depreciation 14,000 Vehicle expenses 29.000 orice expenses 61,000 President's compensation 20.000 Total cost $365,000 Resource consumption is distributed across the activities as follows: Distribution of resource consumption Across Activities Cleaning Travel to Carpets Jobs Wages 771 120 Cleaning supplies 1001 ON Cleaning equipment depreciation 740 os Vehicle expenses os 766 office expenses President's compensation O os Job Support 00 ON 08 08 Other 110 08 26 24 430 688 Total 1001 1001 1008 1001 1000 1001 ot OU 571 32 Job support consists of receiving calls from potential customers at the home office, scheduling jobs, billing, resolving issues, and so on. office expenses President's compensation 00 01 00 ON 571 320 430 688 100% 100 Job support consists of receiving calls from potential customers at the home office, scheduling jobs, billing, resolving issues, and so on. Required: 1. Prepare the first-stage allocation of costs to the activity cost pools. 2. Compute the activity rates for the activity cost pools 3. The company recently completed a 600 square foot carpet-cleaning job at the Flying N Ranch-a 59-mile round-trip Journey from the company's offices in Bozeman Compute the cost of this job using the activity-based costing system. 4. The revenue from the Flying N Ranch was $140.10 (600 square feet o $23.35 per hundred square feet). Calculate the customer margin earned on this job. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Required 4 Prepare the first-stage allocation of costs to the activity cost pools. Cleaning Carpets Travel to Jobs Job Support Other Total Wages Cleaning supplies Cleaning equipment depreciation Vehicle expenses Office expenses President's compensation Total cost Required 1 Required 2 > 578 Office expenses 00 00 435 1001 President's compensation 00 0 32 685 1004 Job support consists of receiving calls from potential customers at the home office, scheduling jobs, billing, resolving issues, and so on. Required: 1. Prepare the first stage allocation of costs to the activity cost pools. 2. Compute the activity rates for the activity cost pools. 3. The company recently completed a 600 square foot carpet-cleaning job at the Flying N Ranch-a 59-mile round-trip journey from the company's offices in Bozeman Compute the cost of this job using the activity-based costing system. 4. The revenue from the Flying N Ranch was $140.10 (600 square feet a $23.35 per hundred square feet). Calculate the customer margin earned on this job. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Required 4 Compute the activity rates for the activity cost pools. (Round your answers to 2 decimal places. Activity Cost Pool Activity Rate Cleaning carpets per hundred square feet Travel to jobs per mile Job Support per job ON 08 08 Vehicle expenses Office expenses President's compensation 769 09 00 08 578 32 241 438 688 100 1000 1008 Job support consists of receiving calls from potential customers at the home office, scheduling jobs, billing, resolving issues on. Required: 1. Prepare the first-stage allocation of costs to the activity cost pools. 2. Compute the activity rates for the activity cost pools. 3. The company recently completed a 600 square foot carpet-cleaning job at the Flying N Ranch-a 59-mile round-trip Jour the company's offices in Bozeman Compute the cost of this job using the activity-based costing system. 4. The revenue from the Flying N Ranch was $140.10 (600 square feet @ $23.35 per hundred square feet). Calculate the cu margin earned on this job. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Required 4 The company recently completed a 600 square foot carpet-cleaning job at the Flying N Ranch-a 59-mile round-trip Journey from the company's offices in Bozeman. Compute the cost of this job using the activity-based costing system. (Round your intermediate calculations and final answer to 2 decimal places.) Cost of the job (Required 2 Required 4 > Vehicle expenses 00 760 01 240 100 Office expenses 00 Os 578 434 100 President's compensation 0 ON 32 685 1001 Job support consists of receiving calls from potential customers at the home office, scheduling jobs, billing, resolving issues, and so on Required: 1. Prepare the first stage allocation of costs to the activity cost pools 2. Compute the activity rates for the activity cost pools. 3. The company recently completed a 600 square foot carpet-cleaning job at the Flying N Ranch-a 59-mile round-trip journey from the company's offices in Bozeman Compute the cost of this job using the activity based costing system 4. The revenue from the Flying N Ranch was $140.10 (600 square feet o $23.35 per hundred square feet), Calculate the customer margin earned on this job. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Requield 4 The revenue from the Flying N Ranch was $140.10 (6 hundred square feet @ $23.35 per hundred square feet). Calculate the customer margin earned on this job. (Negative customer margins should be indicated with a minus sign. Round your Intermediate calculations and final answers to 2 decimal places.) Customer margin

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

Management And Cost Accounting

Authors: Colin Drury

5th Edition

1861525362, 978-1861525369

More Books

Students also viewed these Accounting questions

Question

=+What is the VIF for Age?

Answered: 1 week ago