Big Spenders Steady Spenders Small spenders Sales $148,000,000 $37,740,000 $7,947,500 Total $193,687,500 Less: Sales commissions $4,440,000...

  

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Big Spenders Steady Spenders Small spenders Sales $148,000,000 $37,740,000 $7,947,500 Total $193,687,500 Less: Sales commissions $4,440,000 $754,800 $39,738 $5,234,538 Less: Major account representatives $1,500,000 $0 $0 $1,500,000 Net Sales $142,060,000 $36,985,200 $7,907,763 $186,952,963 Less: Cost of Goods delivered $130,240,000 $33,777,300 $7,271,963 $171,289,263 Gross Margin $11,820,000 $3,207,900 $635,800 $15,663,700 7.99% 8.50% 8.00% 8.09% Less: Cost to Serve Customer order processing $280,065 $153,584 $158,101 $591,750 Deliveries to Customers $341,333 $256,000 $362,667 $960,000 Cartons packed for customers $516,184 $207,395 $68,556 $792,135 Picking costs $253,004 $110,995 $28,565 $392,564 Line item amendments $106,329 $22,785 $20,886 $150,000 Total cost to serve $1,496,915 $750,759 $638,775 $2,886,449 Net profit $10,323,085 $2,457,141 7.0% 6.5% -$2,975 -0.04% $12,777,251 6.6% Managers have noted that their customer portfolio includes a handful of Big Spenders who are generally located relatively close to PVL warehouses. There are a much greater number of Small Spenders at widely dispersed locations at a considerably greater distance from PVL warehouses. The distance of Steady Spenders from the warehouses is between that of the Big and Small Spenders. Big Spenders Steady Spenders Small spenders Sales $148,000,000 $37,740,000 $7,947,500 Total $193,687,500 Less: Sales commissions $4,440,000 $754,800 $39,738 $5,234,538 Less: Major account representatives $1,500,000 $0 $0 $1,500,000 Net Sales $142,060,000 $36,985,200 $7,907,763 $186,952,963 Less: Cost of Goods delivered $130,240,000 $33,777,300 $7,271,963 $171,289,263 Gross Margin $11,820,000 $3,207,900 $635,800 $15,663,700 7.99% 8.50% 8.00% 8.09% Less: Cost to Serve Customer order processing $280,065 $153,584 $158,101 $591,750 Deliveries to Customers $341,333 $256,000 $362,667 $960,000 Cartons packed for customers $516,184 $207,395 $68,556 $792,135 Picking costs $253,004 $110,995 $28,565 $392,564 Line item amendments $106,329 $22,785 $20,886 $150,000 Total cost to serve $1,496,915 $750,759 $638,775 $2,886,449 Net profit $10,323,085 $2,457,141 7.0% 6.5% -$2,975 -0.04% $12,777,251 6.6% Managers have noted that their customer portfolio includes a handful of Big Spenders who are generally located relatively close to PVL warehouses. There are a much greater number of Small Spenders at widely dispersed locations at a considerably greater distance from PVL warehouses. The distance of Steady Spenders from the warehouses is between that of the Big and Small Spenders.

Answer rating: 100% (QA)

ANSWER Based on the information provided lets analyze the financial performance of PVL across the three customer segments Big Spenders Steady Spenders ... View the full answer