H.S. Sponge is a customer of Anton's Wicked Dive Shop. H.S. Sponge makes up 10% of Anton's total sales volume. H.S. Sponge calls in orders twice a week and has a tedious order verification process, thus taking orders from this customer represents 10% of Anton's total order taking costs. Filling H.S. Sponge's orders is relatively painful due to remote geography and delivery inefficiencies; these costs represent 20% of Anton's total order filling costs. Collections from the H.S. Sponge account are not particularly easy, representing 10% of Anton's total collection costs. Here is the total accounting information for Anton's Wicked Dive Shop. Salaries Supplies Depreciation Take Orders Fill Orders Collections TOTAL: $ 300,000 $100,000 $100,000 $ 500,000 O $30,000 O $40,000 O $50,000 $200,000 $200,000 $100,000 $ 500,000 Anton's Wicked Dive Shop believes that H. S. Sponge is a key profitable customer. Using the traditional accounting technique, what is the cost-to-serve for H. S. Sponge that Anton's accounting department would report to the financial community? ● $20,000

H.S. Sponge is a customer of Anton's Wicked Dive Shop. H.S. Sponge makes up 10% of Anton's total sales volume. H.S. Sponge calls in orders twice a week and has a tedious order verification process, thus taking orders from this customer represents 10% of Anton's total order taking costs. Filling H.S. Sponge's orders is relatively painful due to remote geography and delivery inefficiencies; these costs represent 20% of Anton's total order filling costs. Collections from the H.S. Sponge account are not particularly easy, representing 10% of Anton's total collection costs. Here is the total accounting information for Anton's Wicked Dive Shop. Salaries Supplies Depreciation Take Orders Fill Orders Collections TOTAL: $ 300,000 $100,000 $100,000 $ 500,000 O $30,000 O $40,000 O $50,000 $200,000 $200,000 $100,000 $ 500,000 Anton's Wicked Dive Shop believes that H. S. Sponge is a key profitable customer. Using the traditional accounting technique, what is the cost-to-serve for H. S. Sponge that Anton's accounting department would report to the financial community? ● $20,000

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter3: Cost Behavior

Section: Chapter Questions

Problem 34P: Kimball Company has developed the following cost formulas:...

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