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Rensing Groomers is in the dog-grooming business. Its operating costs are described by the following formulas: Grooming supplies (variable) Direct labor (variable) Overhead (mixed) y

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Rensing Groomers is in the dog-grooming business. Its operating costs are described by the following formulas: Grooming supplies (variable) Direct labor (variable) Overhead (mixed) y $0+ $4x $0+ $13x $10,800+ $1x Milo, the owner, has determined that direct labor is the cost driver for all three categories of costs. Your answer is correct. Prepare a flexible budget for activity levels of 510, 600, and 680 direct labor hours. (List variable costs before fixed cost do COSES. RENSING GROOMERS Flexible Budget Activity Level Direct Labor Hours 510 600 680 Variable Costs Grooming Supplies 2040 $ 2400 2720 Direct Labor 6630 i 7800 i 8840 Overhead 510 i 600 i 680 Total Variable Costs 9180 i 10800 i 12200 Fixed Costs 10800 i 10000 Overhead 10800 i 10800 10800 10800 i Total Fixed Costs 23000 21600 i 19980 Total Costs (c) Calculate the total cost per direct labor hour at each of the activity levels specified in part (a). (Round answers to 2 decimal places, eg. 10.25.) Activity level 1 39.18 Activity level 2 $ $ $ 36 Activity level 3 33.88 (d) The groomers at Rensing normally work a total of 650 direct labor hours during each month. Each grooming job normally takes a groomer 1.30 hours. Milo wants to earn a profit equal to 35% of the costs incurred. Determine what he should charge each pet owner for grooming. (Round answer to 2 decimal places, eg. 10.25.) Charge per client $ 59

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