ch5_hw_qa3_part2_br Gallatin Carpet Cleaning is a small, family-owned business operating out of Bozeman, Montana. For Its services, the company hasalways charged a flat fee per hundred square feet of carpet cleaned. The current fee Is $22.05 per hundred square feet. However,there Is some question about whether the company is actually making any money on jobs for some customers-particularly thoselocated on remote ranches that require considerable travel time. The owner's daughter, home for the summer from college, hassuggested investigating this question using activity-based costing. After some discussion, she designed a simple system consisting offour activity cost pools. The activity cost pools and their activity measures appear below:Activity Cost PoolCleaning carpetsTravel to jobsActivity MeasureSquare feet cleaned (88s)Activity for the Year14,000 hundred square feet402, 500 miles2,800 jobsMiles drivenJob supportNumber of jobsOther (organization-sustaining costs and idlecapacity costs)NoneNot applicableThe total cost of operating the company for the year is $362,000 which includes the following costs:143,000WagesCleaning suppliesCleaning equipment depreciationVehicle expenses34, 00014,00028, 000Office expenses58, 000President's compensation85, 900Total cost362,000Resource consumption is distributed across the activities as follows:Distribution of Resource Consumption Across ActivitiesCleaningTravelCarpetsto JobsJob Support OtherTotal75%1e%e%15%1eexWagesCleaning suppliesCleaning equipment depreciationVehicle expenses100%ex100%72%28%100%e%84%16%1eexOffice expensese%e%59%41%100%President's compensatione%30%70%10e%Job support consists of recelving calls from potentlal customers at the home office, scheduling Jobs, billing, resolving Issues, and soon.Required:1. Prepare the first-stage allocation of costs to the activity cost pools.2 Compute the activity rates for the activity cost pools.3. The company recently completed a 800 square foot carpet-cleaning Job at the Flying N Ranch-a 56-mle round-trip journey fromthe company's offices in Bozeman. Compute the cost of this job using the activity-based costing system.4. The revenue from the Flying N Ranch was $176.40 (800 square feet @ $22.05 per hundred square feet). Calculate the customermargin earned on this Job. Required 1Required 2Required 3Required 4Compute the activity rates for the activity cost pools. (Round your answers to 2 decimal places.)Activity Cost PoolActivity RateCleaning carpetsper hundred square feetTravel to jobsper mileJob supportper job

>There are various methods to allocate the overhead support costs that are not directly related…

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 $22.05 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 from college, has suggested investigating this question using activity-based costing. After some discussion, she designed a simple system consisting of four activity cost pools. The activity cost pools and their activity measures appear below: Activity Measure Square feet cleaned (e0s) Activity for the Year 14,000 hundred square feet Activity Cost Pool Cleaning carpets Travel to jobs Job support Miles driven 402, 500 miles Number of jobs 2,000 jobs Other (organization-sustaining costs and idle capacity costs) None Not applicable The total cost of operating the company for the year Is $362,000 which Includes the following costs: $ 143, eee Wages Cleaning supplies Cleaning equipment depreciation Vehicle expenses 34,000 14, eee 28, 00e 58, 000 85, eee $ 362, 00e Office expenses President's compensation Total cost Resource consumption is distributed across the activities as follows: Distribution of Resource Consumption Across Activities Cleaning Carpets 75% Travel to Jobs 1e% Job Support other Total Wages 15% 1eex Cleaning supplies Cleaning equipment depreciation Vehicle expenses Office expenses 10ex ex ex e% 10ex 72% ex ex ex 28% 10ex 84% ex ex 16% 1eex ex 59% 41% 10ex President's compensation ex ex 3ex 7e% 1eex Job support consists of recelving calls from potentlal customers at the home office, scheduling Jobs, billing, resolving Issues, and so on. Required: 1. Prepare the first-stage allocation of costs to the activity cost pools. 2. Compute the activity rates for the activity cost pools. 3. The company recently completed a 800 square foot carpet-cleaning job at the Flying N Ranch-a 56-mile round-trip journey from the company's offices in Bozeman. Compute the cost of this job using the activity-based costing system. 4. The revenue from the Flying N Ranch was $176.40 (800 square feet @ $22.05 per hundred square feet). Calculate the customer margin earned on this lob.