**Green Thumb Gardening: Activity-Based Costing Analysis**Green Thumb Gardening is a small gardening service utilizing activity-based costing to accurately estimate costs for pricing and other purposes. The company owner identifies costs as primarily influenced by factors such as the size of customer lawns, the size of customer garden beds, travel distances to customers, and the number of customers served. Garden bed maintenance costs also depend on whether the beds are low-maintenance (mainly ordinary trees and shrubs) or high-maintenance (mainly flowers and exotic plants). Therefore, Green Thumb Gardening employs five different activity cost pools as outlined below:**Activity Cost Pools and Measures:**| Activity Cost Pool | Activity Measure ||--------------------------------------------------|--------------------------------------------------------|| Caring for lawn | Square feet of lawn || Caring for garden beds—low maintenance | Square feet of low-maintenance beds || Caring for garden beds—high maintenance | Square feet of high-maintenance beds || Travel to jobs | Miles || Customer billing and service | Number of customers |The company has completed its first-stage cost allocations, summarizing its annual costs and activity levels as follows:**Estimated Overhead and Expected Activity:**| Activity Cost Pool | Cost | Expected Activity ||--------------------------------------------------|------------|--------------------------------------------------------|| Caring for lawn | $86,600 | 180,000 square feet of lawn || Caring for garden beds—low maintenance | $39,200 | 29,000 square feet of low-maintenance beds || Caring for garden beds—high maintenance | $64,400 | 23,000 square feet of high-maintenance beds || Travel to jobs | $3,600 | 20,000 miles || Customer billing and service | $7,500 | 38 customers |**Required:**Compute the activity rate for each of the activity cost pools. *Note: Round your answers to two decimal places.***Activity Cost Pool and Rate Calculation:**| Activity Cost Pool | Activity Rate ||--------------------------------------------------|-----------------------------------------------------|| Caring for lawn | [Calculate] per square feet of lawn || Caring for garden beds—low maintenance | [Calculate] per square feet of low-maintenance beds || Caring for garden beds—high maintenance | [Calculate] per square feet of high-maintenance beds|| Travel

Activity Rate is the allocated rate used to allocate overheads . The calculate the rate the indirect…

y uses the five activity cost pools listed below: Square feet of lawn Square feet of low-maintenance beds Square feet of high-maintenance beds Miles Number of customers d its first-stage cost allocations and summarized its annual costs and activity as follows eds-low maintenance eds-high maintenance Activity Measure service

y uses the five activity cost pools listed below: Square feet of lawn Square feet of low-maintenance beds Square feet of high-maintenance beds Miles Number of customers d its first-stage cost allocations and summarized its annual costs and activity as follows eds-low maintenance eds-high maintenance Activity Measure service

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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A department of Delta Company incurred the following costs for the month of June. Variable costs, and the variable portion of mixed costs, are a function of the number of units of activity: Activity level in units Variable costs Fixed costs Mixed costs Total costs During July, the activity level was 9,000 units, and the total costs incurred were $69,000. Required: a. Calculate the variable costs, fixed costs, and mixed costs incurred during July. b. Use the high-low method to calculate the cost formula for mixed cost. Complete this question by entering your answers in the tabs below. Required A Required B 4,500 $ 8,100 30,000 20,800 $ 58,900 Calculate the variable costs, fixed costs, and mixed costs incurred during July. Variable cost Fixed cost Mixed cost July
Gutknecht Corporation uses an activity-based costing system with three activity cost pools. The company has provided the following data concerning its costs and its activity-based costing system: Costs: Wages and salaries Depreciation Utilities Total Distribution of resource consumption: $ 300,000 180,000 240,000 $ 720,000 Wages and salaries Depreciation Utilities Activity Cost Pools Assembly 35% Setting Up Other Total 40% 25% 100% 5% 10% 60% 35% 100% 60% 30% 100% How much cost, in total, would be allocated in the first-stage allocation to the Other activity cost pool? O Multiple Choice $180,000 $216,000 $210,000 $138,000
Connell Co. collects the following data concerning a mixed cost, using miles as the activity level. Miles Driven Total Cost January 10,000 $17,000 February 8,000 $13,500 March 9,000 $14,400 April 7,000 $12,500 Instructions: Compute the variable and fixed cost elements using the high-low method.
1. Compute an activity rate for each activity using activity-based costing.
Assume a company's activity-based costing system includes three activities with the following activity rates: Activity Cost Pool Activity Rate Travel $ 2 per mile driven Deliveries $ 50 per delivery Customer service $ 22 per phone call Two of the company's many customers include Customer A and Customer B. These two customers consumed the company's activities as follows: Total Expected Activity Customer A Customer B Travel (number of miles driven) 300 250 Deliveries (number of deliveries) 15 5 Customer service (number of phone calls) 20 12 If the company earned $1,130 in revenue serving Customer B, then what is the customer margin for this customer? Multiple Choice $96 $156 $116 $136
Question: Pat Company uses activity-based costing. The company has two products: A and B. The annual production and sales for Product A is 1,800 units and for Product B it's 1,050 units. There are three activity cost pools, with estimated costs and expected activity as follows: Activities Estimated Expected Activity Overhead Cost Product A Product Total B Activity 1 $46,775 1,300 1,200 2,500 Activity 2 $68,277 2,300 1,000 3,300 Activity 3 $82,502 The overhead cost per unit of Product A under activity-based costing is closest to: 720 700 1,420 A. $139.12 B. $68.28 C. $32.88 D. $63.19
Solve the questions answer of number 3 & 4