Suppose that Stillwater Designs has two classes of distributors: JIT distributors and non-JIT distributors. The JIT distributor places small, frequent orders, and the non-JIT distributortends to place larger, less frequent orders. Both types of distributors are buying the same product. Stillwater Designs provides the following information about customer-relatedactivities and costs for the most recent quarter:Sales ordersSales callsService callsAverage order sizeManufacturing cost/unitCustomer costs:Processing sales ordersSelling goodsServicing goodsSales (in units)SalesAllocationOrdering costsSelling costsService costsTotal9.23per unitJIT$JITDistributors$3,180,0001,120,0001,050,000$5,350,000Total1. Calculate the total revenues per distributor category, and assign the customer costs to each distributor type by using revenues as the allocation base. Selling price for one unit is$150. Round calculations to the nearest dollar.650,00097,500,0002,675,0001,00070350650$125650,00097,500,0002,675,0002. Conceptual Connection: Calculate the customer cost per distributor type using activity-based cost assignments. Round the interim calculations to the nearest dollar.JIT2,890,909560,000700,0004,150,909For non JIT distributors by how much can the price be decreased without affecting customer profitability? Round your answer to the nearest cent.Non-JITDistributorsNon-JITNon-JIT289,091560,000100350,000701,190,0911756,500$125

Just-in-time (JIT) system of ordering inventory:A Just-in-Time (JIT) system of ordering inventory is…

1. Calculate the total revenues per distributor category, and assign the customer costs to each distributor type by using revenues as the allocation base. Selling price for one unit is $150. Round calculations to the nearest dollar. Sales (in units) Sales Allocation Ordering costs Selling costs Service costs 650,000 650,000 97,500,000 97,500,000 2,675,000 2,675,000 2. Conceptual Connection: Calculate the customer cost per distributor type using activity-based cost assignments. Round the interim calculations to the nearest dollar. JIT 2,890,909 560,000 700,000 JIT $ Total Non-JIT Non-JIT 280,091 560,000 350,000 1,190,091 4,150,909 For non JIT distributors by how much can the price be decreased without affecting customer profitability? Round your answer to the nearest cent. 2.23 per unit

1. Calculate the total revenues per distributor category, and assign the customer costs to each distributor type by using revenues as the allocation base. Selling price for one unit is $150. Round calculations to the nearest dollar. Sales (in units) Sales Allocation Ordering costs Selling costs Service costs 650,000 650,000 97,500,000 97,500,000 2,675,000 2,675,000 2. Conceptual Connection: Calculate the customer cost per distributor type using activity-based cost assignments. Round the interim calculations to the nearest dollar. JIT 2,890,909 560,000 700,000 JIT $ Total Non-JIT Non-JIT 280,091 560,000 350,000 1,190,091 4,150,909 For non JIT distributors by how much can the price be decreased without affecting customer profitability? Round your answer to the nearest cent. 2.23 per unit

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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