Smith Company sells its products at $620 per unit, net 30. The firm's gross margin ratio is 40 percent. The firm has estimated the following operating costs: Activity Sales calls Order processing Deliveries Sales returns $460 per visit $130 per order $80 per order + $0.50 per mile $90 per return and $3 restocking per unit returned Smith Company has gathered the following data pertaining to activities it performed for two of its customers: Cost Driver and Rate Number of orders Number of parts per order Sales returns: Number of returns Number of units returned (per return) Number of sales calls Miles per delivery Shipping terms What is Smith's total customer batch-level cost applicable to Ninto? XBT 16 560 4 40 12 10 FOB, Factory NINTO 2 2,060 10 50 10 20 FOB, Destination
Smith Company sells its products at $620 per unit, net 30. The firm's gross margin ratio is 40 percent. The firm has estimated the following operating costs: Activity Sales calls Order processing Deliveries Sales returns $460 per visit $130 per order $80 per order + $0.50 per mile $90 per return and $3 restocking per unit returned Smith Company has gathered the following data pertaining to activities it performed for two of its customers: Cost Driver and Rate Number of orders Number of parts per order Sales returns: Number of returns Number of units returned (per return) Number of sales calls Miles per delivery Shipping terms What is Smith's total customer batch-level cost applicable to Ninto? XBT 16 560 4 40 12 10 FOB, Factory NINTO 2 2,060 10 50 10 20 FOB, Destination
Managerial Accounting
15th Edition
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:Carl Warren, Ph.d. Cma William B. Tayler
Chapter11: Differential Analysis And Product Pricing
Section: Chapter Questions
Problem 16E
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