41 es such as removing asbestos-contaminated ceiling plaster in industrial buildings. The on-site supervisors believe honroutine...

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41 es such as removing asbestos-contaminated ceiling plaster in industrial buildings. The on-site supervisors believe honroutine work is far more expensive than routine work and should bear higher customer charges. The estimator sums up his position in this way: "My job is to measure the area to be cleared of asbestos. As directed by top management, I simply multiply the square footage by $3.00 to determine the bid price. Because our average cost is only $2.675 per square foot, that leaves enough cushion to take care of the additional costs of nonroutine work. 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 gathered the following activity-based costing data: Activity Cost Pool Activity Measure Thousands of square feet Number of jobs Number of non routine jobs Removing asbestos Estimating and job setup Working on non routine jobs Other (organization-sustaining costs and idle capacity costs) None Total Activity 800 thousand square feet 500 jobs 100 nonroutine jobs Note: The 100 nonroutine jobs are included in the total of 500 jobs. Both nonroutine jobs and routine jobs require estimating and setup. Costs for the Year Wages and salaries Disposal fees Equipment depreciation On-site supplies Office expenses Licensing and insurance Total cost $ 423,000 802,000 96,000 62,000 320,000 510,000 $ 2,213,000 Distribution of Resource Consumption Across Activities Removing Estimating Working on and Job Non routine Asbestos Setup Jobs Other Total Wages and salaries 50% 10% 30% 10% 100% Disposal fees 70% 0% 30% 0% 100% Equipment depreciation 50% 10% 15% 25% 100% On-site supplies 60% 30% 10% 0% 100% Office expenses 10% 35% 25% 30% 100% Licensing and insurance 25% 0% 60% 15% 100% Required: < Prev 8 of 13 Next > Check my 41 es such as removing asbestos-contaminated ceiling plaster in industrial buildings. The on-site supervisors believe honroutine work is far more expensive than routine work and should bear higher customer charges. The estimator sums up his position in this way: "My job is to measure the area to be cleared of asbestos. As directed by top management, I simply multiply the square footage by $3.00 to determine the bid price. Because our average cost is only $2.675 per square foot, that leaves enough cushion to take care of the additional costs of nonroutine work. 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 gathered the following activity-based costing data: Activity Cost Pool Activity Measure Thousands of square feet Number of jobs Number of non routine jobs Removing asbestos Estimating and job setup Working on non routine jobs Other (organization-sustaining costs and idle capacity costs) None Total Activity 800 thousand square feet 500 jobs 100 nonroutine jobs Note: The 100 nonroutine jobs are included in the total of 500 jobs. Both nonroutine jobs and routine jobs require estimating and setup. Costs for the Year Wages and salaries Disposal fees Equipment depreciation On-site supplies Office expenses Licensing and insurance Total cost $ 423,000 802,000 96,000 62,000 320,000 510,000 $ 2,213,000 Distribution of Resource Consumption Across Activities Removing Estimating Working on and Job Non routine Asbestos Setup Jobs Other Total Wages and salaries 50% 10% 30% 10% 100% Disposal fees 70% 0% 30% 0% 100% Equipment depreciation 50% 10% 15% 25% 100% On-site supplies 60% 30% 10% 0% 100% Office expenses 10% 35% 25% 30% 100% Licensing and insurance 25% 0% 60% 15% 100% Required: < Prev 8 of 13 Next > Check my