Refer to the information given in the preceding problem for Fresno Fiber Optics and two of its customers, Trace Telecom and Caltex Computer. Additional information for six of Fresno's other customers for the most recent year follows:
Customer Operating Income
Golden Gate Service Associates ......................................................................... $71,000
Tele-Install, Inc. .................................................................................................. (18,000)
Graydon Computer Company ............................................................................... 60,000
Mid-State Computing Company ............................................................................42,000
Network-All, Inc . ................................................................................................. 93,000
The California Group .............................................................................................. 6,000
Required:
1. Prepare Fresno Fiber Optics' customer profitability profile for the most recent year.
2. As Fresno Fiber Optics' director of cost management, write a memo to the company's vice president of marketing that will accompany the customer profitability profile. Include a brief explanation of the methodology used and comment on the results.