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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

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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 snow removal. The current fee is $10.30 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 Travel to jobs Square metres cleaned (ees) Kilometres driven Number of jobs 49,250 hundred square metres 27,760 kilometres 250 jobs Job support 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 Snow removal equipment depreciation 46,800 26,800 Vehicle expenses 46,000 office expenses 72,888 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 Travel to Jobs Removal Job Support Other Wages 78% 20% et 100% Supplies 100% e% 0% 8% Snow removal equipment depreciation 88% 8% ex Vehicle expenses 8% 70% 806 office expenses 8% 8% 48% President's compensation 8% 0% 45% 20% 30% 68% 55% Total 100% 100% 100% 100% 188% 188% 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.) Activity Cost Pool ABC Cost Snow removal Travel to jobs Job support Total S 0.00 4. The revenue from the Hometown Hardware job was $484.10 (4.700 square metres at $10.30 per hundred square metres). Prepare a report showing the margin from this job. (Round your answers to 2 decimal places.) Sales Costs: Snow removal Travel to jobs Job support 0.00 Product margin $ 0.00

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