Trimline USA provides lawn care and landscaping services to commercial clients. Trimline USA uses activity-based costing to bid on jobs and to evaluate their profitability. Trimline USA reports the following budgeted annual costs:

Wages and salaries: $240,000

Depreciation: 62,000

Supplies: 100,000

Other overhead: 352,000

Total overhead costs: $754,000

John Foster, controller of Trimline USA, has established four activity cost pools and the following budgeted activity for each cost pool:

Activity Cost Pool	Activity Measure	Total Activity for the Year
Estimating jobs	Number of job estimates	325 estimates
Lawn care	Number of direct labor-hours	5,000 direct labor-hours
Landscape design	Number of design hours	250 design hours
Other	Facility-sustaining costs that are not allocated to jobs	Not applicable

Foster estimates that Trimline USA's costs are distributed to the activity-cost pools as follows:

	Estimating Jobs	Lawn Care	Landscape Design	Other	Total
Wages and salaries	5%	60%	10%	25%	100%
Depreciation	20%	55%	15%	10%	100%
Supplies	0%	100%	0%	0%	100%
Other overhead	5%	50%	30%	15%	100%

Sunset Office Park, a new development in a nearby community, has contacted Trimline USA to provide an estimate on landscape design and annual lawn maintenance. The job is estimated to require a single landscape design requiring 40 design hours in total and 325 direct labor-hours annually. Trimline USA has a policy of pricing estimates at 150% of cost.

1.	Allocate Trimline USA's costs to the activity-cost pools and determine the activity rate for each pool.
2.	Estimate total cost for the Sunset Office Park job. How much would Trimline USA bid to perform the job?
3.	Trimline USA does 29 landscape designs for its customers each year. Estimate the total cost for the Sunset Office park job if Trimline USA allocated costs of the Landscape Design activity based on the number of landscape designs rather than the number of landscape design-hours. How much would Trimline USA bid to perform the job? Which cost driver do you prefer for the Landscape Design activity? Why?
4.	Sunset Office Park asks Trimline USA to give an estimate for providing its services for a 2-year period. What are the advantages and disadvantages for Trimline USA to provide a 2-year estimate?