Required: a. Based on cost data from the most recent year, what is the price per pound charged by Evergreen for waste collection under current system (the same rate for both types of customers)? b. Based on cost and waste data from the most recent year, what would be the price per pound charged to households and businesses by Evergreen for waste collection if the CEO's proposal were accepted? Complete this question by entering your answers in the tabs below. Required A Required B Based on cost data from the most recent year, what is the price per pound charged by Evergreen for waste collection under the current system (the same rate for both types of customers)? (Do not round intermediate calculations. Round your answer to 3 decimal places.) Price per pound Required A Required B >

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Required:
a. Based on cost data from the most recent year, what is the price per pound charged by Evergreen for waste collection under
current system (the same rate for both types of customers)?
b. Based on cost and waste data from the most recent year, what would be the price per pound charged to households and
businesses by Evergreen for waste collection if the CEO's proposal were accepted?
Complete this question by entering your answers in the tabs below.
Required A Required B
Based on cost data from the most recent year, what is the price per pound charged by Evergreen for waste collection under
the current system (the same rate for both types of customers)? (Do not round intermediate calculations. Round your answer
to 3 decimal places.)
Price per pound
Required:
a. Based on cost data from the most recent year, what is the price per pound charged by Evergreen for waste collection under the
current system (the same rate for both types of customers)?
Required A
b. Based on cost and waste data from the most recent year, what would be the price per pound charged to households and to
businesses by Evergreen for waste collection if the CEO's proposal were accepted?
Complete this question by entering your answers in the tabs below.
Allocated cost per customer
Total allocated cost
Required A Required B
Based on cost and waste data from the most recent year, complete the following table to determine the price per pound
charged to households and to businesses by Evergreen for waste collection of the CEO's proposal were accepted? (Do not
round intermediate calculations, Round your "Average allocated cost per pound" and "Price" answers to 4 decimal places.
Round your "Allocated cost per customer" and "Total allocated costs" answers to the nearest whole dollar)
Average allocated cost per pound
Price
Required B >
Households
Businesses
(Required A
Required >
Show less A
Transcribed Image Text:Required: a. Based on cost data from the most recent year, what is the price per pound charged by Evergreen for waste collection under current system (the same rate for both types of customers)? b. Based on cost and waste data from the most recent year, what would be the price per pound charged to households and businesses by Evergreen for waste collection if the CEO's proposal were accepted? Complete this question by entering your answers in the tabs below. Required A Required B Based on cost data from the most recent year, what is the price per pound charged by Evergreen for waste collection under the current system (the same rate for both types of customers)? (Do not round intermediate calculations. Round your answer to 3 decimal places.) Price per pound Required: a. Based on cost data from the most recent year, what is the price per pound charged by Evergreen for waste collection under the current system (the same rate for both types of customers)? Required A b. Based on cost and waste data from the most recent year, what would be the price per pound charged to households and to businesses by Evergreen for waste collection if the CEO's proposal were accepted? Complete this question by entering your answers in the tabs below. Allocated cost per customer Total allocated cost Required A Required B Based on cost and waste data from the most recent year, complete the following table to determine the price per pound charged to households and to businesses by Evergreen for waste collection of the CEO's proposal were accepted? (Do not round intermediate calculations, Round your "Average allocated cost per pound" and "Price" answers to 4 decimal places. Round your "Allocated cost per customer" and "Total allocated costs" answers to the nearest whole dollar) Average allocated cost per pound Price Required B > Households Businesses (Required A Required > Show less A
The City of Imperial Falls contracts with Evergreen Waste Collection to provide solid waste collection to households and businesses
Until recently, Evergreen had an exclusive franchise to provide this service in Imperial Falls, which meant that other waste collection
firms could not operate legally in the city. The price per pound of waste collected was regulated at 25 percent above the average total
cost of collection.
Cost data for the most recent year of operations for Evergreen are as follows
Administrative cost
Operating costs-trucks
Other collection costs
$ 407,000
1,315,000
327,000
Data on customers for the most recent year are as follows.
Businesses
Households
12,700
4,700
4,400
13,400
Number of customers
Waste collected (tons)
The City Council of Imperial Falls is considering allowing other private waste haulers to collect waste from businesses, but not from
households. Service to businesses from other waste collection firms would not be subject to price regulation. Based on information
from neighboring cities, the price that other private waste collection firms will charge is estimated to be $0.05 per pound (- $100 per
ton) (1 ton-2,000 pounds)
Evergreen's CEO has approached the city council with a proposal to change the way costs are allocated to households and
businesses, which will result in different rates for households and businesses. She proposes that administrative costs and truck
operating costs be allocated based on the number of customers and the other collection costs be allocated based on pounds
collected. The total costs allocated to households would then be divided by the estimated number of pounds collected from
households to determine the cost of collection. The rate would then be 25 percent above the cost. The rate for businesses would be
determined using the same calculation
Required:
a. Based on cost data from the most recent year, what is the price per pound charged by Evergreen for waste collection under the
current system (the same rate for both types of customers)?
b. Based on cost and waste data from the most recent year, what would be the price per pound charged to households and to
businesses by Evergreen for waste collection if the CEO's proposal were accepted?
Transcribed Image Text:The City of Imperial Falls contracts with Evergreen Waste Collection to provide solid waste collection to households and businesses Until recently, Evergreen had an exclusive franchise to provide this service in Imperial Falls, which meant that other waste collection firms could not operate legally in the city. The price per pound of waste collected was regulated at 25 percent above the average total cost of collection. Cost data for the most recent year of operations for Evergreen are as follows Administrative cost Operating costs-trucks Other collection costs $ 407,000 1,315,000 327,000 Data on customers for the most recent year are as follows. Businesses Households 12,700 4,700 4,400 13,400 Number of customers Waste collected (tons) The City Council of Imperial Falls is considering allowing other private waste haulers to collect waste from businesses, but not from households. Service to businesses from other waste collection firms would not be subject to price regulation. Based on information from neighboring cities, the price that other private waste collection firms will charge is estimated to be $0.05 per pound (- $100 per ton) (1 ton-2,000 pounds) Evergreen's CEO has approached the city council with a proposal to change the way costs are allocated to households and businesses, which will result in different rates for households and businesses. She proposes that administrative costs and truck operating costs be allocated based on the number of customers and the other collection costs be allocated based on pounds collected. The total costs allocated to households would then be divided by the estimated number of pounds collected from households to determine the cost of collection. The rate would then be 25 percent above the cost. The rate for businesses would be determined using the same calculation Required: a. Based on cost data from the most recent year, what is the price per pound charged by Evergreen for waste collection under the current system (the same rate for both types of customers)? b. Based on cost and waste data from the most recent year, what would be the price per pound charged to households and to businesses by Evergreen for waste collection if the CEO's proposal were accepted?
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