The attached document has all the details for this case. Please provide extensive details on the calculations and logic on why something was excluded or included. I am trying to understand this so the more detail up front, the more you can avoid me following up with more questions for clarification. Thanks,

Questions on the case:

- Compute the activity rates (i.e. cost per unit of activity) for all the activity cost pools.

- Using the activity-based costing system, compute the customer margin for the Roessler Family

- Assume the company decides instead to use a traditional costing system in which ALL costs are allocated to customers on the basis of mowing hours. Compute the margin for the Roessler Family.

- The president of Bob's Yard Mowing asks you to explain your decision about how you handled the cost of idle capacity in your calculations above. Explain your reasoning to the president.

- The president also asks you about possible cost savings that could be realized by reducing the total number of jobs by 50. Since the activity level for jobs will decrease, the president says that the savings must be calculated by multiplying the decline in jobs times the activity rate for job support. What is your response to the president?

Bob's Yard Mowing Bob'd Yard Moving provides yard cleaning services to its clients. The company uses an activity-based costing system for its overhead costs. The company has provided the following data from its activity-based costing system. Activity Cost Pool Mowing Job Support Client Support Other Client Roessler family Total Cost Total Activity $645,576 72,700 $129,546 5,400 $20,900 760 $110,000 $906,022 jobs 31 $743.69 hours 62 $550.56 Unit hours jobs clients Cost/unit $8.88 $23.99 $27.50 *cost of idle capacity based on a normal capacity meas charge $1,620 $1,294.25 1) Compute the activity rates (i.e. cost per unit of activity) for all the activity cost pools. 2) Using the activity-based costing system, compute the customer margin for the Roessler Family 3) Assume the company decides instead to use a traditional costing system in which ALL costs are allocated to customers the margin for the Roessler Family. 4) The president of Bob's Yard Mowing asks you to explain your decision about how you handled the cost of idle capacity reasoning to the president. 5) The president also asks you about possible cost savings that could be realized by reducing the total number of jobs by decrease, the president says that the savings must be calculated by multiplying the decline in jobs times the activity rate the president? = This is given information = Questions based on a normal capacity measure L costs are allocated to customers on the basis of mowing hours. Compute u handled the cost of idle capacity in your calculations above. Explain your ucing the total number of jobs by 50. Since the activity level for jobs will ine in jobs times the activity rate for job support. What is your response to Bob's Yard Mowing Bob'd Yard Moving provides yard cleaning services to its clients. The company uses an activity-based costing system for its overhead costs. The company has provided the following data from its activity-based costing system. Activity Cost Pool Mowing Job Support Client Support Other Total Cost Total Activity $645,576 72,700 $129,546 5,400 $20,900 760 $110,000 $906,022 Client Roessler family jobs 31 $743.69 hours 62 $550.56 Unit hours jobs clients Cost/unit $8.88 $23.99 $27.50 *cost of idle capacity based on a normal capacity meas charge $1,620 $1,294.25 1) Compute the activity rates (i.e. cost per unit of activity) for all the activity cost pools. Calculating the activity rates Activity Cost Pool Mowing Job Support Client Support Other Total Cost Total Activity Cost perunit of activity $645,576 72,700 8.88 $129,546 5,400 23.99 $20,900 760 27.5 $110,000 $906,022 2) Using the activity-based costing system, compute the customer margin for the Roessler Family Client Roessler family Per unit activity cost Mowing Job support Cleint support Customer margin jobs 31 23.99 743.69 hours 62 8.88 550.56 charge $1,620 Total cost 550.56 743.69 27.5 1321.75 3) Assume the company decides instead to use a traditional costing system in which ALL costs are allocated to customers the margin for the Roessler Family. Cost per mowing hour =Total overhead cost / Total mowig hours = 906022 / 72700 = 12.46247593 Hours used by Roessler $ Cost per hour = $ Total cost = 62.00 12.46 772.67 4) The president of Bob's Yard Mowing asks you to explain your decision about how you handled the cost of idle capacity reasoning to the president. The cost for the idle capacity will be calculated on the basis of jobs. This cost is the extra suport cost that is being incurred has undertaken. 5) The president also asks you about possible cost savings that could be realized by reducing the total number of jobs by decrease, the president says that the savings must be calculated by multiplying the decline in jobs times the activity rate the president? If we consider the activity based costing, we might be able to save the cost if the number of jobs are decreased, as the Job main activity of the company. Thus by decreasing the job support hours there can be savings. with decrease in 50 hours of be 50*23.99 = 1199.50 = This is given information = Questions based on a normal capacity measure L costs are allocated to customers on the basis of mowing hours. Compute u handled the cost of idle capacity in your calculations above. Explain your suport cost that is being incurred to comply to the jobs that the company ucing the total number of jobs by 50. Since the activity level for jobs will ine in jobs times the activity rate for job support. What is your response to of jobs are decreased, as the Job support cost is the cost to support the ngs. with decrease in 50 hours of job, the cost that is likely to be saved will Bob's Yard Mowing Bob'd Yard Moving provides yard cleaning services to its clients. The company uses an activity-based costing system for its overhead costs. The company has provided the following data from its activity-based costing system. Activity Cost Pool Mowing Job Support Client Support Other Total Cost Total Activity $645,576 72,700 $129,546 5,400 $20,900 760 $110,000 $906,022 Client Roessler family jobs 31 $743.69 hours 62 $550.56 Unit hours jobs clients Cost/unit $8.88 $23.99 $27.50 *cost of idle capacity based on a normal capacity meas charge $1,620 $1,294.25 1) Compute the activity rates (i.e. cost per unit of activity) for all the activity cost pools. Calculating the activity rates Activity Cost Pool Mowing Job Support Client Support Other Total Cost Total Activity Cost perunit of activity $645,576 72,700 8.88 $129,546 5,400 23.99 $20,900 760 27.5 $110,000 $906,022 2) Using the activity-based costing system, compute the customer margin for the Roessler Family Client Roessler family Per unit activity cost Mowing Job support Cleint support Customer margin jobs 31 23.99 743.69 hours 62 8.88 550.56 charge $1,620 Total cost 550.56 743.69 27.5 1321.75 3) Assume the company decides instead to use a traditional costing system in which ALL costs are allocated to customers the margin for the Roessler Family. Cost per mowing hour =Total overhead cost / Total mowig hours = 906022 / 72700 = 12.46247593 Hours used by Roessler $ Cost per hour = $ Total cost = 62.00 12.46 772.67 4) The president of Bob's Yard Mowing asks you to explain your decision about how you handled the cost of idle capacity reasoning to the president. The cost for the idle capacity will be calculated on the basis of jobs. This cost is the extra suport cost that is being incurred has undertaken. 5) The president also asks you about possible cost savings that could be realized by reducing the total number of jobs by decrease, the president says that the savings must be calculated by multiplying the decline in jobs times the activity rate the president? If we consider the activity based costing, we might be able to save the cost if the number of jobs are decreased, as the Job main activity of the company. Thus by decreasing the job support hours there can be savings. with decrease in 50 hours of be 50*23.99 = 1199.50 = This is given information = Questions based on a normal capacity measure L costs are allocated to customers on the basis of mowing hours. Compute u handled the cost of idle capacity in your calculations above. Explain your suport cost that is being incurred to comply to the jobs that the company ucing the total number of jobs by 50. Since the activity level for jobs will ine in jobs times the activity rate for job support. What is your response to of jobs are decreased, as the Job support cost is the cost to support the ngs. with decrease in 50 hours of job, the cost that is likely to be saved will