Customer Profitability Analysis HyStandard Services, Inc. provides residential painting services for three home building companies, Alpine, Blue Ridge, and Pineola, and it uses a job costing system for determining the costs for completing each job. The job cost system does not capture any cost incurred by HyStandard for return touchups and refinishes after the homeowner occupies the home. HyStandard paints each house on a square footage contract price, which includes painting as well as all refinishes and touchups required after the homes are occupied. Each year, the company generates about one-third of its total revenues and gross profits from each of the three builders. The HyStandard owner has observed that the builders, however, require substantially different levels of support following the completion of jobs. The following data have been gathered: Support activity Driver Major refinishes Touchups Hours on jobs Number of visits Communication Number of calls Builder Major Refinishes Touchups Communication Alpine Blue Ridge 150 110 Pineola 115 Assuming that each of the three customers produces gross profits of $170,000, calculate the profitability from each builder after taking into account the support activity required for each builder. Activity. Refinishes Touchups Communication Total support costs $ Gross profit Customer profits $ Cost per Driver Unit $200 100 40 $ 80 35 42 Alpine Blue Ridge 0 $ 0 0 0 $ 0 0 $ 0 0 0 0 $ 0 0 $ $ 360 205 190 Pineola 0 0 0 0 0 0
Customer Profitability Analysis HyStandard Services, Inc. provides residential painting services for three home building companies, Alpine, Blue Ridge, and Pineola, and it uses a job costing system for determining the costs for completing each job. The job cost system does not capture any cost incurred by HyStandard for return touchups and refinishes after the homeowner occupies the home. HyStandard paints each house on a square footage contract price, which includes painting as well as all refinishes and touchups required after the homes are occupied. Each year, the company generates about one-third of its total revenues and gross profits from each of the three builders. The HyStandard owner has observed that the builders, however, require substantially different levels of support following the completion of jobs. The following data have been gathered: Support activity Driver Major refinishes Touchups Hours on jobs Number of visits Communication Number of calls Builder Major Refinishes Touchups Communication Alpine Blue Ridge 150 110 Pineola 115 Assuming that each of the three customers produces gross profits of $170,000, calculate the profitability from each builder after taking into account the support activity required for each builder. Activity. Refinishes Touchups Communication Total support costs $ Gross profit Customer profits $ Cost per Driver Unit $200 100 40 $ 80 35 42 Alpine Blue Ridge 0 $ 0 0 0 $ 0 0 $ 0 0 0 0 $ 0 0 $ $ 360 205 190 Pineola 0 0 0 0 0 0
Chapter2: Building Blocks Of Managerial Accounting
Section: Chapter Questions
Problem 4EA: Hicks Contracting collects and analyzes cost data in order to track the cost of installing decks on...
Related questions
Question
please explain what fromulas and rules were used
![Customer Profitability Analysis
HyStandard Services, Inc. provides residential painting services for three home building companies, Alpine, Blue Ridge, and Pineola, and it uses a job costing system for determining
the costs for completing each job. The job cost system does not capture any cost incurred by HyStandard for return touchups and refinishes after the homeowner occupies the
home. HyStandard paints each house on a square footage contract price, which includes painting as well as all refinishes and touchups required after the homes are occupied. Each
year, the company generates about one-third of its total revenues and gross profits from each of the three builders. The HyStandard owner has observed that the builders,
however, require substantially different levels of support following the completion of jobs. The following data have been gathered:
Support activity Driver
Major refinishes Hours on jobs
Touchups
Number of visits
Communication
Number of calls
Builder Major Refinishes Touchups Communication
Alpine
150
Blue Ridge
110
Pineola
115
Assuming that each of the three customers produces gross profits of $170,000, calculate the profitability from each builder after taking into account the support activity required
for each builder.
Activity.
Refinishes
Touchups
$
Communication
Total support costs $
Gross profit
Customer profits
$
Cost per Driver Unit
$200
100
40
80
35
42
Alpine Blue Ridge
0 $
0
0
0
0
0 $
0
0 $
$
0
0 $
0
0 $
360
205
190
Pineola
0
0
0
0
0
0](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F16fef940-4511-470b-8855-bffc10fcd51b%2F772a93a0-c468-49d7-b4b7-0b67f6b6d6b1%2Ffpl0d77_processed.png&w=3840&q=75)
Transcribed Image Text:Customer Profitability Analysis
HyStandard Services, Inc. provides residential painting services for three home building companies, Alpine, Blue Ridge, and Pineola, and it uses a job costing system for determining
the costs for completing each job. The job cost system does not capture any cost incurred by HyStandard for return touchups and refinishes after the homeowner occupies the
home. HyStandard paints each house on a square footage contract price, which includes painting as well as all refinishes and touchups required after the homes are occupied. Each
year, the company generates about one-third of its total revenues and gross profits from each of the three builders. The HyStandard owner has observed that the builders,
however, require substantially different levels of support following the completion of jobs. The following data have been gathered:
Support activity Driver
Major refinishes Hours on jobs
Touchups
Number of visits
Communication
Number of calls
Builder Major Refinishes Touchups Communication
Alpine
150
Blue Ridge
110
Pineola
115
Assuming that each of the three customers produces gross profits of $170,000, calculate the profitability from each builder after taking into account the support activity required
for each builder.
Activity.
Refinishes
Touchups
$
Communication
Total support costs $
Gross profit
Customer profits
$
Cost per Driver Unit
$200
100
40
80
35
42
Alpine Blue Ridge
0 $
0
0
0
0
0 $
0
0 $
$
0
0 $
0
0 $
360
205
190
Pineola
0
0
0
0
0
0
Expert Solution
![](/static/compass_v2/shared-icons/check-mark.png)
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 3 steps
![Blurred answer](/static/compass_v2/solution-images/blurred-answer.jpg)
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Principles of Accounting Volume 2
Accounting
ISBN:
9781947172609
Author:
OpenStax
Publisher:
OpenStax College
![Managerial Accounting: The Cornerstone of Busines…](https://www.bartleby.com/isbn_cover_images/9781337115773/9781337115773_smallCoverImage.gif)
Managerial Accounting: The Cornerstone of Busines…
Accounting
ISBN:
9781337115773
Author:
Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:
Cengage Learning
![Cornerstones of Cost Management (Cornerstones Ser…](https://www.bartleby.com/isbn_cover_images/9781305970663/9781305970663_smallCoverImage.gif)
Cornerstones of Cost Management (Cornerstones Ser…
Accounting
ISBN:
9781305970663
Author:
Don R. Hansen, Maryanne M. Mowen
Publisher:
Cengage Learning
Principles of Accounting Volume 2
Accounting
ISBN:
9781947172609
Author:
OpenStax
Publisher:
OpenStax College
![Managerial Accounting: The Cornerstone of Busines…](https://www.bartleby.com/isbn_cover_images/9781337115773/9781337115773_smallCoverImage.gif)
Managerial Accounting: The Cornerstone of Busines…
Accounting
ISBN:
9781337115773
Author:
Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:
Cengage Learning
![Cornerstones of Cost Management (Cornerstones Ser…](https://www.bartleby.com/isbn_cover_images/9781305970663/9781305970663_smallCoverImage.gif)
Cornerstones of Cost Management (Cornerstones Ser…
Accounting
ISBN:
9781305970663
Author:
Don R. Hansen, Maryanne M. Mowen
Publisher:
Cengage Learning
![Managerial Accounting](https://www.bartleby.com/isbn_cover_images/9781337912020/9781337912020_smallCoverImage.jpg)
Managerial Accounting
Accounting
ISBN:
9781337912020
Author:
Carl Warren, Ph.d. Cma William B. Tayler
Publisher:
South-Western College Pub
![Principles of Cost Accounting](https://www.bartleby.com/isbn_cover_images/9781305087408/9781305087408_smallCoverImage.gif)
Principles of Cost Accounting
Accounting
ISBN:
9781305087408
Author:
Edward J. Vanderbeck, Maria R. Mitchell
Publisher:
Cengage Learning