Refer to Exercise 12-29.

Compton Associates is an architectural firm that has been in practice only a few years. Because it is a relatively new firm, the market for the firm's services is very competitive. To compete successfully, Compton must deliver quality services at a low cost. Compton presents the following data for 2016 and 2017.

Architect labor-hour costs are variable costs. Architect support costs for each year depend on the Architect support capacity that Compton chooses to maintain each year (that is, the number of jobs it can do each year). Architect support costs do not vary with the actual number of jobs done that year.
Required
1. Calculate the amount and cost of unused architectural support capacity at the beginning of 2017, based on the number of jobs actually done in 2017.
2. Suppose Compton can add or reduce its architectural support capacity in increments of 10 units. What is the maximum amount of costs that Compton could save in 2017 by downsizing architectural support capacity?
3. Compton, in fact, does not eliminate any of its unused architectural support capacity. Why might Compton not downsize?

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2016 2017 1. Number of jobs billed 2. Selling price per job 3. Architect labor-hours 4. Cost per architect labor-hour 5. Architect support capacity (number of jobs the firm can do) 6. Total cost of software-implementation support 40 50 30 0000 24,000 S35 60 $168,000 7. Software-implementation support-capacity cost per job (row 6row5)$2,800 27,000 S36 60 S180,000 3,000