SAMSUNG MH Connect Practice chapter 6 0 C Oeziomieducation.com/hrn tpx?-\"0.0686
ID: 2576549 • Letter: S
Question
SAMSUNG MH Connect Practice chapter 6 0 C Oeziomieducation.com/hrn tpx?-"0.06868801010451 786.151 10.00 poinh Gallatin Carpet Cleaning is a small, family-owned business operating out of Bozeman, Montana. For its services, the company has always charged a flat fee per hundred square feet of carpet cleaned. The current fee is $23.75 per hundred square feet However, there is some question about whether the company is actually making any money on jobs for some customers-particularly those located on remote ranches that require considerable travel time. The owner's daughter, home for the summer fronm college, has suggested investigating this question using activity-based costing. After some discussion, a simple system consisting of four activity cost pools seemed to be adequate. The activity cost pools and their activity measures appear below of idle cnpacity The total cost of operating the company for the year is $349,000, which includes the following costs: Cleaning susples Vehicle eapienses Total cost 54000 Resource consumption is distributed across the activities as follows: Distribution of Resource Consumption Across Activities Wages Cleaning supplies 733 27% Job support consists of receiving calls from potential customers at the home office, scheduling jobs, billing, resolving issues, and so on.Explanation / Answer
Requirement 1: First stage allocation of costs to the activity cost pools: Cleaning carpets Travel to jobs Job Support Other Total Wages 112180 15620 14200 142000 Cleaning Supplies 20000 20000 Cleaning Equipment Depreciation 8760 3240 12000 Vehicle Expenses 29260 8740 38000 Office Expenses 37120 20880 58000 President's Compensation 19750 59250 79000 Total 140940 44880 56870 106310 349000 Requirement 2: Computation of Activity rates for the activity cost pools: Acticity Cost Pool Activity Rate Cleaning Carpets 140940/10000 14.09 per hundred sq ft Travel to jobs 44880/84500 0.53 per mile Job Support 56870/1900 29.93 per job Requirement 3: Computation of cost of job: Cleaning Carpets 14.094*4 56.38 Travel to jobs 0.53112426*57 30.27 Job Support 29.93 Cost of the job 116.58 Requirement 4: Report showing margin from the job: Revenue 95 Less: Costs Cleaning Carpets 56.38 Travel to jobs 30.27 Job Support 29.93 Cost of the job 116.58 Margin -21.58
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.