Colleen Company has gathered the following data pertaining to activities it performed for two of its...
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Colleen Company has gathered the following data pertaining to activities it performed for two of its major customers. Number of orders Units per order Sales returns: Number of returns. Total units returned Number of sales calls Activity Sales calls Order processing Deliveries Sales returns Sales salary Jerry, Inc. Kate Co. 6 1,000 Colleen sells its products at $290 per unit. The firm's gross margin ratio is 20%. Both Jerry and Kate pay their accounts promptly and no accounts receivable is over 30 days. After using business analytics software to carefully analyze the operating data for the past 30 months, the firm has determined the following activity costs: Required 1 Required 2 4 50 13 30 420 Customer unit level costs: 5 140 5 Required: 1. Using customers as the cost objects, classify the activity costs into cost categories (unit-level, batch-level, etc.) and compute the total cost for Colleen Company to service Jerry, Inc. and Kate Co. 2. Compare the profitability of these two customers. Cost Driver and Rate $ 888 per visit 180 per order 410 per order 270 per return and $3 per unit returned 107,000 per month Complete this question by entering your answers in the tabs below. S Using customers as the cost objects, classify the activity costs into cost categories (unit- the total cost for Colleen Company to service Jerry, Inc. and Kate Co. Jerry Inc. 150 $ Kate Co. 420 Colleen Company has gathered the following data pertaining to activities it performed for two of its major customers. Number of orders Units per order Sales returns: Number of returns. Total units returned Number of sales calls Activity Sales calls Order processing Deliveries Sales returns Sales salary Jerry, Inc. Kate Co. 6 1,000 Colleen sells its products at $290 per unit. The firm's gross margin ratio is 20%. Both Jerry and Kate pay their accounts promptly and no accounts receivable is over 30 days. After using business analytics software to carefully analyze the operating data for the past 30 months, the firm has determined the following activity costs: Required 1 Required 2 4 50 13 30 420 Customer unit level costs: 5 140 5 Required: 1. Using customers as the cost objects, classify the activity costs into cost categories (unit-level, batch-level, etc.) and compute the total cost for Colleen Company to service Jerry, Inc. and Kate Co. 2. Compare the profitability of these two customers. Cost Driver and Rate $ 888 per visit 180 per order 410 per order 270 per return and $3 per unit returned 107,000 per month Complete this question by entering your answers in the tabs below. S Using customers as the cost objects, classify the activity costs into cost categories (unit- the total cost for Colleen Company to service Jerry, Inc. and Kate Co. Jerry Inc. 150 $ Kate Co. 420
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Answer rating: 100% (QA)
Customer UnitLevel Costs 1 Sales Calls Jerry Inc 4 sales calls 888 per visit 3552 Kate Co 5 sales calls 888 per visit 4440 Customer BatchLevel Costs 2 ... View the full answer
Related Book For
Cost Management A Strategic Emphasis
ISBN: 978-0078025532
6th edition
Authors: Edward Blocher, David Stout, Paul Juras, Gary Cokins
Posted Date:
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