Total Activity Mercer Asbestos Removal Company removes potentially toxic asbestos insulation and related products from buildings. There has been a long-simmering dispute between the company's estimator and the work supervisors. The on-site supervisors claim that the estimators do not adequately distinguish between routine work, such as removal of asbestos insulation around heating pipes in older homes, and nonroutine work, such as removing asbestos contaminated ceiling plaster in industrial buildings. The on-site supervisors believe that nontoutine work is far more expensive than routine work and should bear higher customer charges. The estimator sums up his position in this way "My job is to measure the area to be cleared of asbestos. As directed by top management, I simply multiply the square footage by $3 20 to determine the bid price. Since our average cost is only $2805 per square foot, that leaves enough cushion to take care of the additional costs of nonroutine work that shows up Besides, it is difficult to know what is routine or not routine until you actually start tearing things apart." To shed light on this controversy, the company initiated an activity-based costing study of all of its costs Data from the activity-based costing system follow Activity Cost Pool Activity Measure Removing asbestos Thousands of square feet 850 thousand square feet Estimating and job setup 400 jobs Working on nonroutine jobs 100 non routine jobs Other (organization-sustaining costs and Lole capacity costs) D Note: The 100 nonroutine jobs are included in the total of 400 jobs. Both nonroutine jobs and routine jobs require estimating and setup costs for the Year wages and salaries Disposal toes 24,000 Equipment depreciation On-site supplies office expenses Licensing and insurance Total cost Distribution of Resource Consumption Across Activities Estimating working on Number of Jobs Number of nonroutine jobs None 5.440,000 100,000 64,000 340,000 540,000 3.2.316,000 and Job Setup 10 Removing Asbestos 50% 20% 401 so 153 301 Mages and salaries Disposal fees Equipment depreciation Onsite supplies office expenses Licensing and insurance toroutine Jobs 30 30% 204 103 203 5% other 105 ox 35% OX 30% 10% Total 100% 100% 100% 100% 100% 100% 35% Ox Required: 1. Perform the first stage allocation of costs to the activity cost pools 2. Compute the activity rates for the activity cost pools 35% SOX Distribution of Resource Consumption Across Activities Estimating Working on Removing and Job Nonroutine Asbestos Setup Jobs Other Total Wages and salaries SOR 105 303 10% 100% Disposal fees 70% 03 sex OX 100% Equipment depreciation 40% 5% On-site supplies 20% 35% 100% 60X 30% office expenses 10% OX 1eos 15% 201 Licensing and insurance 100% 30% GO 103 100% Required: 1. Perform the first stage allocation of costs to the activity cost pools 2. Compute the activity rates for the activity cost pools. 3. Using the activity rates you have computed determine the total cost and the average cost per thousand square feet of each of the following jobs according to the activity based costing system a. A routine 1000 square foot asbestos removal job b. A routine 2,000-square-foot asbestos removal job c. A nonroutine 2,000-square foot asbestos removal job Complete this question by entering your answers in the tabs below. Reg 2 Reg 1 Rea JA to 30 Perform the first stage allocation of costs to the activity cost pools Removing asbestos Estimating and Job Setup Working on Nonroutine Other Jobs Total Wages and salaries Disposal fees Equipment depreciation On site supplies Office expenses Licensing and insurance Total cost RA Req2 > Total cost 5 2,316,000 Distribution of Resource Consumption across Activities Estimating Working on Removing and Job Monroutine Asbestos Setup Jobs Mages and soleries SOK 10% Disposal fees 301 20% 05 30% Equipment depreciation 40% 5% On-site supplies 2013 60% office expenses 10% 15% 35% Licensing and insurance 20% 30% 60% Total 100% Other 10% OM 35% OX 306 10% 30 100% 100% 100% 100% 100% Required: 1. Perform the first stage allocation of costs to the activity cost pools 2. Compute the activity rates for the activity cost pools 3. Using the activity rates you have computed, determine the total cost and the average cost per thousand square feet of each of the following jobs according to the activity-based costing system a. A routine 1000 square foot asbestos removal job. b. A routine 2000 square-foot asbestos removal job c A nonroutine 2000-square-foot asbestos removal job: Complete this question by entering your answers in the tabs below. Reg1 Reg2 Rog JA to Compute the activity rates for the activity cost pools inclivity Cost Pool Removing asbestos Estimating and job setup Working on monroutine jobs Activity Rate per thousand square feet per job per nonroutine Job Distribution of Resource Consumption Across Activities Estimating Working on Removing and Job Nonroutine Asbestos Setup Jobs Wages and salaries 50% 10% 30% Disposal fees 70% ox 30% Equipment depreciation 40K 5% 2ex On-site supplies 60% 30% 10% office expenses 15% 35% 204 Licensing and Insurance 30% ox 60% Other 10% 0% 35% Total 100X 100% 100% 10ex 100% 100% 0% 30% 10% Required: 1. Perform the first stage allocation of costs to the activity cost pools 2. Compute the activity rates for the activity cost pools. 3. Using the activity rates you have computed, determine the total cost and the average cost per thousand square feet of each of the following jobs according to the activity-based costing system a. A routine 1000 square foot asbestos removal job b. A routine 2,000 square foot asbestos removal job c Anonroutine 2,000-square-foot asbestos removal job Complete this question by entering your answers in the tabs below. Reg1 Reg 2 Reg 3A to 30 Using the activity rates you have computed, determine the total cost and the average cost per thousand square feet of each of the following jobs according to the activity based costing system. (Round the "Average Cost per thousand square feet" to 2 decimal places) a. A routine 1,000-square-foot asbestos removal job b. A routine 2,000-square-foot asbestos removal job c. A nonroutine 2,000 square foot asbestos removal job Show less Nonroutine Routine 1,000 Routine 2,000 square footjob quare footjob feetlob Total cost of the job Average Cost per thousand square foot