Anskar Industries makes computer modems that are used in a broad range of channels. Its three largest customer segments are large businesses, small businesses, and retail stores. The costs and revenues associated with these three segments are noted in the table below.

REQUIRED:

a. Compute the segment profitability in dollars and percentages for each segment.

b. Based on these results, which segment is best for Simpson to serve? Which is worst?

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Anskar Industries Lorge Businesses Small Businesses Retail Stores Company Totd Revenues $10,000,000 $4,500,000 $12,000,000 $26,500,000 Less: Direct material costs $4,700,000 $2,160,000 $5,760,000 $12,620,000 Direct labor costs $800,000 $360,000 $1,200,000 $2,360,000 General overhead costs $1,800,000 $1,000,000 $2,000,000 $4,800,000 Distribution costs $275,000 $550,000 $400,000 $1,225,000 Customer service costs $150,000 $250,000 S- $400,000 Warranties and repairs $100,000 $150,000 $275,000 $525,000