50.1K

Verified Solution

Link Copied!

Vance Asbestos Removal Company removes potentially toxic asbestos insulation and related products from buildings. The company's estimator has been involved in a long-simmering dispute with the on-site work supervisors. The on-site supervisors claim that the estimator does not adequately distinguish between routine work, such as removal of asbestos insulation around heating pipes in older hupervisors bon-routine work, such as removing asbestos-contaminated ceiling plaster in industrial buildings. The on-s. The estimator su believe that non-routine work is far more expensive than routine work and should bear higher customer charg management, 1 sim sum his position in this way "My job is to measure the area to be cleared of asbestos. As directed by top average cost is onply multiply the square metres by $4,700 per thousand square metres to determine the bid price. Since our av non-routin only $3,700 per thousand square metres, that leaves enough cushion to take care of the additional costs of non-routine work that shows up. Besides, it is difficult to know what is routine or not routine until you actually start tearing things apart." To shed light on this controversy, the company initiated an ABC study of all of its costs. Data from the ABC system follow * The total number of jobs includes non-routine jobs as well as routine jobs. Non-routine jobs as well as routine jobs require estimating and setup work. Distribution of Resource Consurution acmace Required: 1. Perform the first-stage allocation of costs to the activity cost pools. (Do not leave any empty spaces; input a 0 wherever it is required.) 2. Compute the activity rates for the activity cost pools. (Round your answers to 2 decimal places.) 3. Using the activity rates you have computed, determine the total cost and the average cost per thousand square metres of each of the following jobs according to the ABC system: a. A routine 1,000-square-metre asbestos removal job. (Round your answers to 2 decimal places.) b. A routine 2,000-square-metre asbestos removal job. (Round your answers to 2 decimal places.) c. A non-routine 1,000-square-metre asbestos removal job. (Round your answers to 2 decimal places.)

Answer & Explanation Solved by verified expert

See Answer