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Clauson Associates prepares architectural drawings to conform to local structural-safety codes. (Click the icon to view the income statement.) Click the icon to view the percentage of time spent on activities.) Assume administrative and support costs vary with professional-labor costs. Consider each requirement independently. Read the requirements Requirement 1. How much of the total costs in 2017 are value-added, non-value-added, or in the gray area between? Explain your answers briefly. What actions can Clauson take to reduce its costs? Begin by calculating the total labor costs, then calculate the total costs. (If a box is not used in the table, leave the box empty, do not enter a zero. Round your answers to the nearest whole dollar.) Gray Value- Added Non-value -Added Area Total Making calculations and preparing drawings Checking calculations and drawings Correcting errors found in drawings Enter any number in the edit fields and then click Check Answer. ? 8 parts remaining Clear All Check Answer Clauson Associates prepares architectural drawings to conform to local structural-safety codes. Click the icon to view the income statement.) Click the icon to view the percentage of time spent on activities.) Assume administrative and support costs vary with professional-labor costs. Consider each requirement independently. Read the requirements. empty; do not enter a zero. Round your answers to the nearest whole dollar.) Value- Gray Area Non-value -Added Added Total Making calculations and preparing drawings Checking calculations and drawings Correcting errors found in drawings Making changes in response to client requests Correcting errors to meet government building code Total professional labor costs Enter any number in the edit fields and then click Check Answer 8 parts remaining Clear All Check Answer nt on activities.) Independently. ea between? Clauson Associates prepares architectural drawings to conform to local structural-safety codes. B! (Click the ico - X Assume administ 0 Data Table Read the require Its income statement for 2017 is as follows: Requirement 1. Explain your ans $ 622,915 Revenues Begin by calculat Salaries of professional staff (7,900 hours * $49 per hour) 387,100 empty, do not en Travel 16,000 158,711 Administrative and support costs Total costs 561,811 Making calculati 61,104 Checking calcula Operating income Correcting errors Print Done Enter any numbe pave the box 8 parts remaining Clear All Check Answer Clauson Associates prepares architectural drawings to conform to local structural-safety codes. Click the icon to view the income statement.) Click the icon to view the percentage of time spent on activities.) Assume admi x lependently. * Data Table Read the rea 10 The percentage of time spent by professional staff on various activities follows: between? Requirement Explain your Begin by cald empty, do no 73 % ve the box 3 Making calculations and preparing drawings for clients Checking calculations and drawings Correcting errors found in drawings (not billed to clients) Making changes in response to client requests (billed to clients) Correcting own errors regarding building codes (not billed to clients) 8 7 9 Making calcu Checking call Correcting or Total 100 % Enter any nun Print Done 8 parts remaining Clear All Check Answer n Associates prepares architectural drawings to conform to local structural-safety codes. . i Requirements ti ar in y; 1. How much of the total costs in 2017 are value-added, non-value-added, or in the gray area between? Explain your answers briefly. What actions can Clauson take to reduce its costs? 2. What are the consequences of misclassifying a non-value-added cost as a value-added cost? When in doubt, would you classify a cost as a value-added or non-value-added cost? Explain briefly. 3. Suppose Clauson could eliminate all errors so that it did not need to spend any time making corrections and, as a result, could proportionately reduce professional-labor costs. Calculate Clauson's operating income for 2017 4. Now suppose Clauson could take on as much business as it could complete, but it could not add more professional staff. Assume Clauson could eliminate all errors so that it does not need to spend any time correcting errors. Assume Clauson could use the time saved to increase revenues proportionately. Assume travel costs will remain at $16,000. Calculate Clauson's operating income for 2017 ind ecki TEC ra Print Done part rem