Estimatin Working on Removing AsbestosJob Setup Nonrouine Wages and salanes On-s

Question

Estimatin Working on Removing AsbestosJob Setup Nonrouine Wages and salanes On-she supplies and insurnce Total cost 2 Compute the activiy rates for the activity cost pools Activity Cost Pool Activity Rate Extimaing and job setup Wonking on nanoutine jobs per thousand per job per nenroutne s 3 Using the activity rates you have computed, detemine the total cost and the average cost per housand square feet of ear °rding to the actrite-based cosing system (Round the "Average cost', to 2 decimal places , 1,000-square-foot asbestos removal job. a. A routine 1,000-square toot asbestos removal j Total coat of the job Average cost per thousand square feet b A routine 2,cco square-foat asbestos removal job Total cost of the job Average cost per thousand square foet c. A nonoutine 2.000-square foot asbestos removal job Total cost of the job Average cost per thousand square feet

Explanation / Answer

Answer 1. Distribution of Resource Consumption Across Activities Removing Asbestos Estimating & Job Setup Working on Nonroutine Jobs Other Total Wages & Salaries        207,000.00      41,400.00         124,200.00      41,400.00          414,000.00 Disposal Fees        565,600.00                     -           242,400.00                     -            808,000.00 Equipment Depreciation          47,000.00        9,400.00           14,100.00      23,500.00            94,000.00 On-site Supplies          42,700.00      12,200.00             6,100.00                     -              61,000.00 Office Expenses          31,000.00    108,500.00           77,500.00      93,000.00          310,000.00 Licensing & Insurance        127,500.00                     -           306,000.00      76,500.00          510,000.00 Total    1,020,800.00    171,500.00         770,300.00    234,400.00      2,197,000.00 Answer 2. Calculation of Activity Rate Total cost Allocation Base Allocation Rate Removing Asbestos          1,020,800                  800 thousand sq. feet        1,276.00 per thousand sq. feet Estimating & Job Setup              171,500                  500 jobs            343.00 per job Working on Nonroutine Jobs              770,300                  100 non routine jobs        7,703.00 per non routine job Other              234,400 NA NA Total Overhead          2,197,000 Answer 3-a. Cost of Routine 1,000 square foot asbestos removal JoB Removing Asbestos - $1,276 X 1            1,276.00 Estimating & Job Setup - $343 X 1                343.00 Working on Nonroutine Jobs                         -   Total Cost of the Job            1,619.00 Cost per thousand sq feet - $1,619 / 1            1,619.00 Answer 3-b. Cost of Routine 2,000 square foot asbestos removal JoB Removing Asbestos - $1,276 X 2            2,552.00 Estimating & Job Setup - $343 X 1                343.00 Working on Nonroutine Jobs                         -   Total Cost of the Job            2,895.00 Cost per thousand sq feet - $2,895 / 2            1,447.50 Answer 3-c. Cost of Non-routine 2,000 square foot asbestos removal Job Removing Asbestos - $1,276 X 2            2,552.00 Estimating & Job Setup - $343 X 1                343.00 Working on Nonroutine Jobs - $7,703 X 1            7,703.00 Total Cost of the Job          10,598.00 Cost per thousand sq feet - $2,895 / 2            5,299.00

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