Bid preparation Shipment Support standard items Support nonstandard items Number of bid requests Number of shipments Number of standard items ordered Number of nonstandard items ordered Revenues Fost of goods sold Assume that the company had the following gross profit information for three representative customers: Gross profit Gross profit as a percent of sales Customer 1 Customer 2 $130,000 $210,000 (81,900) (113,400) $48,100 $96,600 46% 37% Activity Base Number of bid requests Number of shipments Number of standard items ordered Number of nonstandard items ordered $420 per request $90 per shipment $30 per std. item $180 per nonstd. item The administrative records indicated that the activity- base usage quantities for each customer were as follows: 25 20 Customer 3 $180,000 (90,000) $90,000 Customer 1 Customer 2 Customer 3 15 40 60 55 50 35 52 65 85 6 50% a. Prepare a customer profitability report dated for the year ended December 31, 20Y8, showing (1) the operating income after customer service activities, (2) the gross profit as a percent of sales, and (3) the operating income after customer service activities as a percent of sales. Prepare the report with a column for each customer. Round percentages to the nearest whole percent.
Bad Debts
At the end of the accounting period, a financial statement is prepared by every company, then at that time while preparing the financial statement, the company determines among its total receivable amount how much portion of receivables is collected by the company during that accounting period.
Accounts Receivable
The word “account receivable” means the payment is yet to be made for the work that is already done. Generally, each and every business sells its goods and services either in cash or in credit. So, when the goods are sold on credit account receivable arise which means the company is going to get the payment from its customer to whom the goods are sold on credit. Usually, the credit period may be for a very short period of time and in some rare cases it takes a year.
![Bid preparation
Shipment
Support standard items
Support nonstandard items
Number of bid requests
Number of shipments
Number of standard items ordered
Number of nonstandard items ordered
Assume that the company had the following gross profit
information for three representative customers:
Revenues
Cost of goods sold
Gross profit
Gross profit as a percent of sales
Customer 1 Customer 2
$130,000
$210,000
(113,400)
$96,600
(81,900)
$48,100
Activity Base
Number of bid requests.
Number of shipments
Number of standard items ordered.
Number of nonstandard items ordered.
Revenues
Cost of goods sold
Gross profit
Customer service activities:
Bid preparation
37%
Shipment
Support standard items
Support nonstandard items
Total customer service activities.
The administrative records indicated that the activity-
base usage quantities for each customer were as
follows:
6
Customer 1 Customer 2 Customer 3
15
40
60
25
55
50
20
35
52
65
85
a. Prepare a customer profitability report dated for the
year ended December 31, 20Y8, showing (1) the
operating income after customer service activities, (2)
the gross profit as a percent of sales, and (3) the
operating income after customer service activities as a
percent of sales. Prepare the report with a column for
each customer. Round percentages to the nearest
whole percent.
Operating income after customer service activities
Gross profit as a percent of sales
Operating income after customer
service activities as a percent of
sales
46%
Metroid Electric
Customer Profitability Report
For the Year Ended December 31, 20Y8
$
Customer 3
$180,000
(90,000)
$90,000
$
$
Customer Customer Customer
$
$420 per request
$90 per shipment
$30 per std. item
$180 per nonstd. item
%
%
50%
2
$
$
$
%
%
3
$
$
%
%](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fae65326f-1aec-436f-bd95-4f0c169b975a%2F0009827b-1f39-4053-9c8e-e10b3eaef625%2Fifhiodp_processed.jpeg&w=3840&q=75)
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