Gallatin Carpet Cleaning is a small, family-owned business operating out of Bozeman, Montana. For its services, the company has always charged a flat fee per hundred square feet of carpet cleaned. The current fee is $28 per hundred square feet. However, there is some question about whether the company is actually making any money on jobs for some customers—particularly those located on remote ranches that require considerable travel time. The owner’s daughter, home for the summer from college, has suggested investigating this question using activity-based costing. After some discussion, a simple system consisting of four activity cost pools seemed to be adequate. The activity cost pools and their activity measures appear below:Activity Cost Pool Activity Measure Activity for the Year
Cleaning carpets Square feet cleaned (00s) 14,500 hundred square feet
Travel to jobs Miles driven 291,500 miles
Job support Number of jobs 1,900 jobs
Other (costs of idle capacity and organization-sustaining costs) None Not applicable
The total cost of operating the company for the year is $338,000, which includes the following costs:

Wages $136,000
Cleaning supplies 26,000
Cleaning equipment depreciation 8,000
Vehicle expenses 30,000
Office expenses 57,000
President's compensation 81,000
Total cost $338,000
Resource consumption is distributed across the activities as follows:

Distribution of Resource Consumption Across Activities

Cleaning Carpets Travel to Jobs Job Support Other Total
Wages 74% 13% 0% 13% 100%
Cleaning supplies 100% 0% 0% 0% 100%
Cleaning equipment depreciation 66% 0% 0% 34% 100%
Vehicle expenses 0% 77% 0% 23% 100%
Office expenses 0% 0% 58% 42% 100%
President's compensation 0% 0% 30% 70% 100%
Job support consists of receiving calls from potential customers at the home office, scheduling jobs, billing, resolving issues, and so on.

Required:

1) Prepare the first-stage allocation of costs to the activity cost pools.

2) Compute the activity rates for the activity cost pools.