Answered step by step
Verified Expert Solution
Question
1 Approved Answer
The Coletti Cleaning Brigade Company provides housecleaning services to its clients. The company uses an activity-based costing system for its overhead costs. The company has
The Coletti Cleaning Brigade Company provides housecleaning 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 Total Cost Total Activity Cleaning $ 299,976 43,100 hours Job support 75,722 4,820 jobs Client support 3,063 166 clients Other 147,000 Not applicable ________________________________________ ________________________________________ Total $ 525,761 The Other activity cost pool consists of the costs of idle capacity and organization-sustaining costs. One particular client, the Tubman family, requested 21 jobs during the year that required a total of 84 hours of housecleaning. For this service, the client was charged $1,490. Required: a. Using the activity-based costing system, compute the customer margin for the Tubman family. (Round your answer to 2 decimal places. Omit the "$" sign in your response.) Customer margin $ b. Assume the company decides instead to use a traditional costing system in which ALL costs are allocated to customers on the basis of cleaning hours. Compute the margin for the Tubman family. (Round your intermediate and final answer to 2 decimal places. Omit the "$" sign in your response.) Customer margin $
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started