-S requiring considerable travel time. The owner's daughter suggested answering this question by designing an activity- based costing system using the information shown below. Activity Cost Pool Cleaning carpets Travel to jobs Job support Other (organization-sustaining costs and idle capacity costs) Wages Cleaning supplies Cleaning equipment depreciation Vehicle expenses Office expenses President's compensation Not applicable The total cost of operating the company for the year is $359,000 which includes the following costs: $ 141,000 22,000 Total cost Activity Measure Square feet cleaned (00s) Miles driven Number of jobs None 71,000 78,000 $ 359,000 She distributed these operating costs across her four activities as follows: Wages Cleaning supplies Cleaning equipment depreciation Vehicle expenses Office expenses President's compensation 14,000 33,000 Distribution of Resource Consumption Across Activities Cleaning Travel Job Carpets to Jobs Support Other 73% 0% 16% 100% 0% 0% 61% 0% 0% 0% 11% 0% 0% 79% 0% 0% Activity for the Year hundred square 08 0% 14,000 feet 116,500 miles 2,500 jobs 59% 27% Total 100% 100% 39% 100% 21% 100% 41% 100% 73% 100% Job support consists of receiving calls from potential 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 400-square-foot carpet-c ning job at the Flying N Ranch-a 57-mile round-trip from the company's home office. Compute the cost of this job using the activity-based costing system. 4. The revenue from the Flying N Ranch was $52.60 (400 square feet @ $13.15 per hundred square feet). Calculate the customer margin earned on this job.
-S requiring considerable travel time. The owner's daughter suggested answering this question by designing an activity- based costing system using the information shown below. Activity Cost Pool Cleaning carpets Travel to jobs Job support Other (organization-sustaining costs and idle capacity costs) Wages Cleaning supplies Cleaning equipment depreciation Vehicle expenses Office expenses President's compensation Not applicable The total cost of operating the company for the year is $359,000 which includes the following costs: $ 141,000 22,000 Total cost Activity Measure Square feet cleaned (00s) Miles driven Number of jobs None 71,000 78,000 $ 359,000 She distributed these operating costs across her four activities as follows: Wages Cleaning supplies Cleaning equipment depreciation Vehicle expenses Office expenses President's compensation 14,000 33,000 Distribution of Resource Consumption Across Activities Cleaning Travel Job Carpets to Jobs Support Other 73% 0% 16% 100% 0% 0% 61% 0% 0% 0% 11% 0% 0% 79% 0% 0% Activity for the Year hundred square 08 0% 14,000 feet 116,500 miles 2,500 jobs 59% 27% Total 100% 100% 39% 100% 21% 100% 41% 100% 73% 100% Job support consists of receiving calls from potential 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 400-square-foot carpet-c ning job at the Flying N Ranch-a 57-mile round-trip from the company's home office. Compute the cost of this job using the activity-based costing system. 4. The revenue from the Flying N Ranch was $52.60 (400 square feet @ $13.15 per hundred square feet). Calculate the customer margin earned on this job.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:1
requiring considerable travel time. The owner's daughter suggested answering this question by designing an activity-
based costing system using the information shown below.
ok
1
ht
nces
Activity Cost Pool
Cleaning carpets
Travel to jobs
Job support
Other (organization-sustaining
costs and idle capacity
costs)
Wages
Cleaning supplies
Cleaning equipment
depreciation
Vehicle expenses
Office expenses
President's compensation
Not applicable
The total cost of operating the company for the year is $359,000 which includes the following costs:
$
141,000
22,000
14,000
33,000
71,000
78,000
$
359,000
She distributed these operating costs across her four activities as follows:
Total cost
Wages
Cleaning supplies
Cleaning equipment
depreciation
Activity Measure
Square feet cleaned
(00s)
Miles driven
Number of jobs
Vehicle expenses
Office expenses
President's compensation
None
Distribution of Resource Consumption Across Activities
Cleaning Travel Job
Carpets to Jobs Support Other Total
73%
08
16%
100%
100%
0%
0%
100%
Wages
Cleaning supplies
Cleaning equipment
depreciation
Vehicle expenses
Office expenses
President's compensation
Total cost
61%
08
0%
0%
11%
0%
0 $
0%
79%
0%
08
< Required 1
Activity for the Year
hundred square
0%
0%
59%
27%
Job support consists of receiving calls from potential customers at the home office, scheduling jobs, billing, resolving
issues, and so on.
14,000 feet
116,500 miles
2,500 jobs
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 400-square-foot carpet-cleaning job at the Flying N Ranch-a 57-mile round-trip
from the company's home office. Compute the cost of this job using the activity-based costing system.
4. The revenue from the Flying N Ranch was $52.60 (400 square feet @ $13.15 per hundred square feet). Calculate the
customer margin earned on this job.
Complete this question by entering your answers in the tabs below.
Required Required Required Required
1
2
3
Prepare the first-stage allocation of costs to the activity cost pools.
Cleaning Travel to
Carpets Jobs
Job
Support
0 $
39%
21%
41%
100%
73% 100%
100%
100%
Other
0 $
Required 2 >
$
Total
0 $
0
0
0
0
0
0
0
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