Kenosha Winter Services is a small, family$-$owned snow$-$removal business. For its services, the company has always charged a flat fee per hundred square metres of snow removal. The current fee is $$10\mathrm{.}30$ per hundred square metres. However, there is some question about whether the company is actually making any money on jobs for some customers$$particularly those located on more remote properties that require considerable travel time. The owner$$s daughter, home from school for the summer, has suggested investigating this question using ABC. 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:

Activity Cost Pool Activity Measure Activity for the Year

Snow removal Square metres cleaned $(00$s$)49,250$ hundred square metres

Travel to jobs Kilometres driven $27,760$ kilometres

Job support Number of jobs $250$ jobs

Other $($costs of idle capacity and organization$-$sustaining costs$)$ None NA

The total cost of operating the company for the year is $$480,000,$ which includes the following costs:

Wages $ $186,000$

Supplies $46,000$

Snow removal equipment depreciation $26,000$

Vehicle expenses $46,000$

Office expenses $72,000$

President$$s compensation $104,000$

Total cost $ $480,000$

Resource consumption is distributed across the activities as follows:

Distribution of Resource Consumption

across Activity Cost Pools

Snow Removal Travel to Jobs Job Support Other Total

Wages $70\%20\%0\%10\%100\%$

Supplies $100\%0\%0\%0\%100\%$

Snow removal equipment depreciation $80\%0\%0\%20\%100\%$

Vehicle expenses $0\%70\%0\%30\%100\%$

Office expenses $0\%0\%40\%60\%100\%$

President$$s compensation $0\%0\%45\%55\%100\%$

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. $($Do not leave any empty spaces; input a $0$ wherever it is required.$)$

$2.$ Compute the activity rates for the activity cost pools. $($Round your answers to $2$ decimal places.$)$

$3.$ The company recently completed a $4,700-$square$-$metre snow removal job at Hometown Hardware$$a $87-$kilometre round$-$trip journey from Kenosha$$s offices. Compute the cost of this job using the ABC system. $($Round your answers to $2$ decimal places.$)$

$4.$ The revenue from the Hometown Hardware job was $$484\mathrm{.}10(4,700$ square metres at $$10\mathrm{.}30$ per hundred square metres$).$ Prepare a report showing the margin from this job. $($Round your answers to $2$ decimal places.$)$

$5.$ This part of the question is not part of your Connect assignment.

$6.$ This part of the question is not part of your Connect assignment.

PrevQuestion $5$ of $5$ Total$5$ of $5$Visit question mapThis is the last question in the assignment. To submit, use Alt $+$ S$.$ To access other questions, proceed to the question map button.Next