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 $11 60 per hundred square metres However, there is some question about whether the company is actually making any money on jobs for some customersparticularly those located on more remote properties that require considerable travel time The owners 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 (00s) 37,395 hundred square metres Travel to jobs Kilometres driven 17,150 kilometres Job support Number of jobs 350 jobs Other (costs of idle capacity and organization sustaining costs) None NA The total cost of operating the company for the year is $412,500, which includes the following costs Wages $ 159,000 Supplies 41,500 Snow removal equipment depreciation 21,500 Vehicle expenses 41,500 Office expenses 63,000 Presidents compensation 86,000 Total cost $ 412,500 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 80 10 0 10 100 Supplies 100 0 0 0 100 Snow removal equipment depreciation 85 0 0 15 100 Vehicle expenses 0 65 0 35 100 Office expenses 0 0 45 55 100 Presidents compensation 0 0 35 65 100 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 3,800 square metre snow removal job at Hometown Hardwarea 78 kilometre round trip journey from Kenoshas 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 $440 80 (3,800 square metres at $11 60 per hundred square metres) Prepare a report showing the margin from this job (Round your answer)

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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

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 $11.60 per hundred square metres. However, there is some question about whether the company is actually making any money on jobs for some customersparticularly those located on more remote properties that require considerable travel time. The owners 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 (00s)	37,395	hundred square metres
Travel to jobs	Kilometres driven	17,150	kilometres
Job support	Number of jobs	350	jobs
Other (costs of idle capacity and organization-sustaining costs)	None	NA

The total cost of operating the company for the year is $412,500, which includes the following costs:


Wages	$	159,000
Supplies		41,500
Snow removal equipment depreciation		21,500
Vehicle expenses		41,500
Office expenses		63,000
Presidents compensation		86,000
Total cost	$	412,500

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		80	%		10	%	0	%	10	%	100	%
Supplies		100	%		0	%	0	%	0	%	100	%
Snow removal equipment depreciation		85	%		0	%	0	%	15	%	100	%
Vehicle expenses		0	%		65	%	0	%	35	%	100	%
Office expenses		0	%		0	%	45	%	55	%	100	%
Presidents compensation		0	%		0	%	35	%	65	%	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 3,800-square-metre snow removal job at Hometown Hardwarea 78-kilometre round-trip journey from Kenoshas 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 $440.80 (3,800 square metres at $11.60 per hundred square metres). Prepare a report showing the margin from this job. (Round your answer)