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need help with the second part: What is the total cost of Amy Lee's remodeling job under the activity-based costing system? thanks! Curtis &
need help with the second part: "What is the total cost of Amy Lee's remodeling job under the activity-based costing system? " thanks!
Curtis & Company is an architectural firm specializing in home remodeling for private clients and new office buildings for corporate clients. Curtis & Company charges customers at a billing rate equal to 135% of the client's total job cost. A client's total job cost is a combination of 1) professional cost, based on the professional hours spent on the client's job and the firm's average professional salary, and 2) operating costs, allocated to the client's job, using a "single driver system," with the number of professional hours spent on the job as the cost driver. However, near the end of 2020, Curtis' accountant decided to replace the single driver system for allocating operating costs with an activity-based costing system. For 2021, Curtis estimates its five professionals will work a total of 11,000 hours on client jobs during the year, and their salaries will total $825,000. As part of the new ABC system, the accountant has grouped all of the firm's operating costs (travel reimbursements, copy costs, secretarial salaries, office lease, etc.) into three activities, and has provided the following estimates for these activities: Total Activity Cost $9,400 Total Usage by Private Clients Activity Transportation to clients Cost Driver Total Usage by Corporate Clients 2,900 miles Round-trip mileage to clients 12,900 miles Blueprint copying $33,600 Number of copies 160 copies 600 copies Office support $189,400 Secretarial time 2,300 hours 2,800 hours Total operating costs $232,400 During 2021, Amy Lee hired Curtis & Company to design her kitchen remodeling. A total of 22 professional hours were spent on this job. In addition, Amy's remodeling job required one of the professionals to travel back and forth to her house for a total of 110 miles. The blueprints had to be copied four times because Amy changed the plans several times. In addition, 15 hours of secretarial time were used lining up the subcontractors for the job. REQUIRED [ROUND ALL ALLOCATION RATES TO THE NEAREST CENT AND ALLOCATIONS TO THE NEAREST DOLLAR.] Part A [5 tries; 5 points] What would the total cost of Amy Lee's remodeling job have been under the old single-driver system? 2,115Step by Step Solution
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