Advanced Coding is a software development company that sells specialized practice management software to large professional services firms. Management has decided to analyze certain costs related to sales to determine per-customer profitability and to plan for future sales efforts. These costs include sales commissions and overhead related to the corporate jet expenses. They have determined that $200,000 of overhead costs related to the corporate jet should be assigned to individual customers.

Sales representatives are paid a commission of 5% on Gross Profit (sales less costs to develop the software). In relation to overhead costs, the sales staff used the corporate jet at a cost of $1,000 per hour for trips to customers as follows:

Customer #1: 50 hours

Customer #2: 43 hours

Customer #3: 15 hours

Customer #4: 8 hours

Customer #5: 10 hours

Gross profit per customer is as follows:

Customer #1: $360,000

Customer #2: $260,000

Customer #3: $80,000

Customer #4: $100,000

Customer #5: $80,000

(NOTE: Do not round amounts until final calculation of customer profitability, then round to the nearest dollar).

Which customer is the most profitable?

Group of answer choices

A. customer #5

B. customer #4

C. customer #3

D. customer #2

E. customer #1