Customer profitability, customer-cost hierarchy. Enviro-Tech has only two retail and two whole- sale customers. Information relating to each customer for 2017 follows (in thousands): Wholesale Customers Retail Customers North America South America Wholesaler Wholesaler Revenues at list prices Discounts from list prices Cost of goods sold Delivery costs Order processing costs $375,000 25,800 285,000 4,550 3,820 6,300 $590,000 47,200 510,000 6,710 Green Energy Global Power $175,000 8,400 144,000 2,230 2,180 2,620 $130,000 590 95,000 2,145 1,130 1,575 5,980 2,620 Cost of sales visit Enviro-Tech's annual distribution-channel costs are $33 million for wholesale customers and $12 million for retail customers. The company's annual corporate-sustaining costs, such as salary for top management and general-administration costs are $48 million. There is no cause-and-effect or benefits-received rela- tionship between any cost-allocation base and corporate-sustaining costs. That is, Enviro-Tech could save corporate-sustaining costs only if the company completely shuts down.
Process Costing
Process costing is a sort of operation costing which is employed to determine the value of a product at each process or stage of producing process, applicable where goods produced from a series of continuous operations or procedure.
Job Costing
Job costing is adhesive costs of each and every job involved in the production processes. It is an accounting measure. It is a method which determines the cost of specific jobs, which are performed according to the consumer’s specifications. Job costing is possible only in businesses where the production is done as per the customer’s requirement. For example, some customers order to manufacture furniture as per their needs.
ABC Costing
Cost Accounting is a form of managerial accounting that helps the company in assessing the total variable cost so as to compute the cost of production. Cost accounting is generally used by the management so as to ensure better decision-making. In comparison to financial accounting, cost accounting has to follow a set standard ad can be used flexibly by the management as per their needs. The types of Cost Accounting include – Lean Accounting, Standard Costing, Marginal Costing and Activity Based Costing.
Calculate customer-level operating income
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