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PetSmart, Inc. is a large specialty pet retailer of services and solutions for the needs of pets. In addition to selling pet food and pet
PetSmart, Inc. is a large specialty pet retailer of services and solutions for the needs of pets. In addition to selling pet food and pet products, PetSmart also offers dog grooming services including bath, nail trim, teeth brushing, aromatherapy to reduce everyday stress, and nail polish and stickers. PetSmart even offers a Top Dog service that includes a premium shampoo, milk bath conditioner, scented cologne spritz, teeth brushing, and bandana or bow. Assume PetSmart, Inc. expects to incur $380,000 of indirect costs this year. The company allocates indirect costs based on the following activities: E: (Click the icon to view the data.) Read the requirements. Requirement 1. Calculate the predetermined overhead allocation rate for each activity. (Abbreviation used: qty = quantity. Round your answers to the nearest cent, X.XX.) Predetermined OH allocation rate Admissions Data Table = Cleaning Grooming Estimated Cost Estimated Quantity of Allocation Base Activity Allocation Base Admission $ 60,000 Number of admissions 20,000 Cleaning 100,000 Grooming 240,000 Cleaning direct labor hours 80,000 Grooming direct labor hours 380,000 4,000 $ Total indirect costs Print Done Choose from any list or enter any number in the input fields and then click Check Answer. - Requirements 1. Calculate the predetermined overhead allocation rate for each activity. 2. Assume a customer brought in Sophie, a beagle, for Top Dog service. PetSmart used the following resources: 1 Allocation Base Sophie, Beagle Number of admissions Cleaning direct labor hours Grooming direct labor hours 0.5 Determine the total cost of the Top Dog service for Sophie assuming the total direct materials cost was $3.50 and the total direct labor cost was $12 per DLHr. 3. If PetSmart desires a 30% target operating income after covering all its costs, what would PetSmart have to charge the customer to achieve that operating income? Print Done
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