1 answer

Green Thumb Gardening is a small gardening service that uses activity-based costing to estimate costs for...

Question:

Green Thumb Gardening is a small gardening service that uses activity-based costing to estimate costs for pricing and other p
Green Thumb Gardening is a small gardening service that uses activity-based costing to estimate costs for pricing and other purposes. The proprietor of the company believes that costs are driven primarily by the size of customer lawns, the size of customer garden beds, the distance to travel to customers, and the number of customers. In addition, the costs of maintaining garden beds depends on whether the beds are low maintenance beds (mainly ordinary trees and shrubs) or high maintenance beds (mainly flowers and exotic plants). Accordingly, the company uses the five activity cost pools listed below: 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 Niles Customer billing and service Number of customers The company already has completed its first stage allocations of costs and has summarized its annual costs and activity as follows: Activity Cost Pool Caring for lawn Caring for garden beds-low maintenance Caring for garden beds-high maintenance Travel to jobs Customer billing and service Estimated Overhead Cost $ 85,000 $ 37,600 $ 50, 540 $ 4,400 $9,100 Expected Activity 165,000 square feet of law 25,000 square feet of low maintenance beds 19,000 square feet of high maintenance beds 16,000 miles 24 customers Required: Compute the activity rate for each of the activity cost pools (Round your answers to 2 decimal places.) Activity Rate Activity Cost Pool Caring for lawn rar inte har man port of lawn naranna hate Graw M Prey 1 of 4 Noxt > Oo ype here to search o I

Answers

Activity rate for each of activity pool

Carrying for lawn =85000/165000

=0.52

Carrying cost for garden beds low maintenance =37600/25000

=1.50

Carrying cost for garden beds high maintenance=50540/19000

=2.66

Travel to jobs =4400/16000

=0.275

Customer billing and service=9100/24

=379.17

.

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