Reference no: EM13646458

Jared Painting paints the interiors and exteriors of homes and commercial buildings. The company uses an activity-based costing system for its overhead costs. The company has provided the following data concerning its activity-based costing system.

	Activity Cost Pool	Activity Measure	Annual Activity
	Painting overhead..............	Square meters	10,000	square meters
	Job support.........................	Jobs	200	jobs
	Other..................................	None	Not	applicable

The "Other" activity cost pool consists of the costs of idle capacity and organization-sustaining costs.

The company has already finished the first stage of the allocation process in which costs were allocated to the activity cost centers. The results are listed below:

			Job
		Painting	Support	Other	Total
	Painting overhead.....	$  99,000	$  45,000	$36,000	$180,000
	Office expense..........	6,000	78,000	36,000	120,000
	Total..........................	$105,000	$123,000	$72,000	$300,000

Required:

a. Compute the activity rates for the Painting and Job Support activity cost pools by filling in the table below. Round off all calculations to the nearest whole cent.

			Job
		Painting	Support
	Painting overhead.....
	Office expense..........
	Total..........................

b. Prepare an action analysis report in good form of a job that involves painting 71 square meters and has direct materials and direct labor cost of $2,410. The sales revenue from this job is $3,800.

For purposes of this action analysis report, direct materials and direct labor should be classified as a Green cost; painting overhead as a Red cost; and office expense as a Yellow cost.