1. Using information given in the case, allocate the companys shared costs to each service line four different ways: based on FTEs, direct-labor costs, direct labor plus direct materials, and the specific usage information given to Finnegan by Bennett.

2. Calculate the profit percentage for each service line under each overhead-allocation method.

3. Which service line is the most financially attractive? Does the fact that design and installation clients often use Finnegans Gardens for maintenance services change your answer?

4. Assume volume and revenues for each service line could grow by 10%. Which service line should Finnegan expand? Is your answer congruent with your answer to Question 3? Why or why not?

FINNEGAN'S GARDENS Pick inte ut back is his office chair and frowned in front of him lay the Isles income statement for Finnegan's Gardens, the landscaping business he had non since purchasing The Garden Center from Mary Jane Bowers more than four years ago Ismol Finnegan did not too much time reviewing is company financial dute. As long as protected to Finnegan considered faces to be the responsibility of his account Set Bent. Recently, however, he had become focused on the financial results of innegan's Gardens. Finnegan hati in college and he knew his family would be incang con cover the next several years. Turnegie wanted to prow did now which of the company's the service lines presented the machine opportunity MACKGROUND After wing college degree anticipe anche right of Grand her howcased The Gueden Center from Mary Jane Boweniec de eney, is mal open and trained the pylorice can be. Over time. Finns det ind deputation locally and demand for the services como Finance pride in providing a full of lading mantan to and identice SERVICES PROVIDED Tepe's Gaming chard we one the vided lupe designer hohen during your 10 pannenplayers te planne design che and her cu.000 whe e premier Ladasanna put their royed With The condition etc. MacBook Pro U a IL & $ 4 . 2 3 % 5 6 7 8 > 0 9 W W E R T Y U I 0 a S D F G H . J K L VINNEGAN'S ANALYSIS Finna Soked again at the company's most recent statement of camin Exhibit). Although the firm was clearly making a profit margin of approximately 12 overall aware of three services were equally profitable information ended in order to decide which service she should try to expand. He concluded was about time he paid attention to the company's accounting and decided to call Sue Bent with some additional questions Based on their discussion Fintean lamed the following indormation: 1. In addition to integan's 585.000 ml way, the other garden designer cared 562,000 year. During the past year, an venge of 80% of the designers time w ponton design, the rest on een spend administration 2. Munt de cou were 45% of times for the year and 1 mane revers Each installation employee worked average of 1.300 hours a year $15 an hour Tachmance employee worked in age of 1,200 yer of 512 an hout Miscenos mals and other applies tag of the forte Vines Follow us with Bennett, Fine sat down and prepared mot of caring for each of the company's service line Ehibit 2) Finnegan knew that cute locatie of the shadows of depreciation, rent and support peroducentical to do wiele profits for his company, but he did wot know what expenses. Therefore he thout in cabudnit.d called for hele Them de several ways" Bannel to responses quoti shout ovated section Sometimes, send us for news located based on the sumber of fanployees (ET) Inchi line Orders, who allocated based or direct laboe dollars, direct labor dollars placeral coll other to your home Indition, you in which you the vilimet tye wach of the vehetdepot Tutti i ditemte of FTE for active Time in win the shortestar 3 secondente dhe docido pay for the view et facity with two pewne tovi Anew wodos. widove andare wwwww to wrest of $10.000 CASE NON SOLDES MacBook Pro 0 A 3 $ 4 5 6 & 7 8 9 ) 0 W E R T Y U 0 P { regardless of the service line the chief expand. Finnegan looked forward to completing his analysis as posible, and hoped he would not have to concentrate on the financial data for Hina's Gardens too much longer REQUIRED 1 Using Information given in the case, allocate the company's shared costs to each Service line for offerent ways based on FTE, direct labor costs, direct labor plus direct material, and the specific usage information given to Finnegan by Tin 2. Calculate the wofit percentage for each service line under each over allocation metod 3. Which wavica line is the most financially attractive! Does die and intelles de Fittan't Cardet for me change your answer 4. Acume volume and res for each service line could grow by service line should Finnegan expendle your wer conga warto QuestionWhy or why noc? PART IL FUNDAMENTALS OF PRODUCT AND SERVICE COSTING MacBook Pro $ & 3 4 5 Exhibit FINNEGAN'S GARDENS Statement of Earnings Toult $ 1.200.000 Pluss, wxd Drect labor Other material, applies Payrol and reception Purchasing, accounts payable Vehicle depec Furreardpreatm IT systems deprecation Office duties Nurserys, tilties and tence 411.000 187,200 38400 49.000 31,000 3000 18750 14.000 30 $132350 5 187450 CANTIDOTUSARIENS MacBook Pro U 0 S A & 3 % 5 4 6 7 + 8 9 0 E R T Y U 0 P Exhibit FINNEGAN'S GARDENS Fan Statement by Service Line OS 20 1152 Or 130 w 120 14.000 IT HO De DI 1 5 d's 10 PARTILFINNAMENTALS DE PRODUKTAND SERVICE COSTING MacBook Pro O, 2 3 $ 4 5 6 & 7 + 8 9 0 W E R T Y C Edit FINNEGAN'S GARDENS Depura Usage of Shared Resource IT Pala) inte 20 49 73 100 30 00 11 MacBook Pro O, Q TI IL * 3 S 4 3 5 6 & 7 8 9 3. 0 W E R T Y U FINNEGAN'S GARDENS Pick inte ut back is his office chair and frowned in front of him lay the Isles income statement for Finnegan's Gardens, the landscaping business he had non since purchasing The Garden Center from Mary Jane Bowers more than four years ago Ismol Finnegan did not too much time reviewing is company financial dute. As long as protected to Finnegan considered faces to be the responsibility of his account Set Bent. Recently, however, he had become focused on the financial results of innegan's Gardens. Finnegan hati in college and he knew his family would be incang con cover the next several years. Turnegie wanted to prow did now which of the company's the service lines presented the machine opportunity MACKGROUND After wing college degree anticipe anche right of Grand her howcased The Gueden Center from Mary Jane Boweniec de eney, is mal open and trained the pylorice can be. Over time. Finns det ind deputation locally and demand for the services como Finance pride in providing a full of lading mantan to and identice SERVICES PROVIDED Tepe's Gaming chard we one the vided lupe designer hohen during your 10 pannenplayers te planne design che and her cu.000 whe e premier Ladasanna put their royed With The condition etc. MacBook Pro U a IL & $ 4 . 2 3 % 5 6 7 8 > 0 9 W W E R T Y U I 0 a S D F G H . J K L VINNEGAN'S ANALYSIS Finna Soked again at the company's most recent statement of camin Exhibit). Although the firm was clearly making a profit margin of approximately 12 overall aware of three services were equally profitable information ended in order to decide which service she should try to expand. He concluded was about time he paid attention to the company's accounting and decided to call Sue Bent with some additional questions Based on their discussion Fintean lamed the following indormation: 1. In addition to integan's 585.000 ml way, the other garden designer cared 562,000 year. During the past year, an venge of 80% of the designers time w ponton design, the rest on een spend administration 2. Munt de cou were 45% of times for the year and 1 mane revers Each installation employee worked average of 1.300 hours a year $15 an hour Tachmance employee worked in age of 1,200 yer of 512 an hout Miscenos mals and other applies tag of the forte Vines Follow us with Bennett, Fine sat down and prepared mot of caring for each of the company's service line Ehibit 2) Finnegan knew that cute locatie of the shadows of depreciation, rent and support peroducentical to do wiele profits for his company, but he did wot know what expenses. Therefore he thout in cabudnit.d called for hele Them de several ways" Bannel to responses quoti shout ovated section Sometimes, send us for news located based on the sumber of fanployees (ET) Inchi line Orders, who allocated based or direct laboe dollars, direct labor dollars placeral coll other to your home Indition, you in which you the vilimet tye wach of the vehetdepot Tutti i ditemte of FTE for active Time in win the shortestar 3 secondente dhe docido pay for the view et facity with two pewne tovi Anew wodos. widove andare wwwww to wrest of $10.000 CASE NON SOLDES MacBook Pro 0 A 3 $ 4 5 6 & 7 8 9 ) 0 W E R T Y U 0 P { regardless of the service line the chief expand. Finnegan looked forward to completing his analysis as posible, and hoped he would not have to concentrate on the financial data for Hina's Gardens too much longer REQUIRED 1 Using Information given in the case, allocate the company's shared costs to each Service line for offerent ways based on FTE, direct labor costs, direct labor plus direct material, and the specific usage information given to Finnegan by Tin 2. Calculate the wofit percentage for each service line under each over allocation metod 3. Which wavica line is the most financially attractive! Does die and intelles de Fittan't Cardet for me change your answer 4. Acume volume and res for each service line could grow by service line should Finnegan expendle your wer conga warto QuestionWhy or why noc? PART IL FUNDAMENTALS OF PRODUCT AND SERVICE COSTING MacBook Pro $ & 3 4 5 Exhibit FINNEGAN'S GARDENS Statement of Earnings Toult $ 1.200.000 Pluss, wxd Drect labor Other material, applies Payrol and reception Purchasing, accounts payable Vehicle depec Furreardpreatm IT systems deprecation Office duties Nurserys, tilties and tence 411.000 187,200 38400 49.000 31,000 3000 18750 14.000 30 $132350 5 187450 CANTIDOTUSARIENS MacBook Pro U 0 S A & 3 % 5 4 6 7 + 8 9 0 E R T Y U 0 P Exhibit FINNEGAN'S GARDENS Fan Statement by Service Line OS 20 1152 Or 130 w 120 14.000 IT HO De DI 1 5 d's 10 PARTILFINNAMENTALS DE PRODUKTAND SERVICE COSTING MacBook Pro O, 2 3 $ 4 5 6 & 7 + 8 9 0 W E R T Y C Edit FINNEGAN'S GARDENS Depura Usage of Shared Resource IT Pala) inte 20 49 73 100 30 00 11 MacBook Pro O, Q TI IL * 3 S 4 3 5 6 & 7 8 9 3. 0 W E R T Y U