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More Info The cost driver for all these resources is number of times cleaned. Wages for cleaning laborers (called porters) and rent for cleaning equipment
More Info The cost driver for all these resources is "number of times cleaned." Wages for cleaning laborers (called porters) and rent for cleaning equipment are the same regardless of the number of times the supermarket is cleaned. Supplies used for each regular daily cleaning and for each special cleaning are about the same. A typical store has 52,000 square feet. Regular cleaning is performed each day from midnight until 7:00 AM. Special cleaning of floors and fixtures is performed in the various departments as needed. Special cleaning varies from 10 to 30 times a month depending on the amount of traffic through the store. Thus, the number of times a store is cleaned varies from 40 to 60 times a month. Suppose that in one of Turner's stores in Minneapolis, cleaning was performed 60 times during March. For the month, the cost of labor and rent on equipment was $26,000 and cleaning supplies used cost $9,600. The sales budget for the next quarter (April through June) and better weather conditions indicate that the store will need to be cleaned 50, 48, and 35 times in April, May, and June respectively. Print Done Maintaining a clean shopping environment is a key success factor for Turner, a large grocery chain based in Minnesota. Three of the most costly resources needed to clean a supermarket are labor, equipment, and cleaning supplies. (Click the icon to view more information.) Read the requirements Requirement 3. Suppose the manager of the Turner store can hire an outside cleaning company to clean the store as needed. The charge rate is $700 per cleaning. If the outside cleaning company is hired, Turner can lay off the workers who are now cleaning the store, eliminate the need for equipment rent, and stop purchasing cleaning supplies. Will Turner save money with the outside cleaning company over the next quarter? Prepare a schedule that supports your answer. Costs of Turner cleaning the store Outside Number of times store is cleaned Labor and rent cost Cleaning supplies cost Total cost cleaning cost April May June 35 IN Click the graph to plot the first point on your line
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