Copy of Problem-14-21

Copy of Problem-14-21 - 14-21 Customer profitability,...

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Avery Okie Wizard Grainger Duran Total Activity Area Cost Driver Rate Revenues $260,000 $200,000 $322,000 $122,000 $212,000 $1,116,000 Service call handling $75 per service call Technician and equipment cost 182,000 175,000 225,000 107,000 178,000 867,000 Parts ordering $80 per web-based parts order Office overhead allocated 31,859 24,507 39,457 14,949 25,978 136,750 Billing and collection $50 per bill (or reminder) Operating income $ 46,141 $ 493 $ 57,543 $ 51 $ 8,022 $ 112,250 Customer database maintenance $10 per service call Avery Okie Wizard Grainger Duran Number of service calls 150 240 40 120 180 Number of web-based parts orders 120 210 60 150 150 Number of bills (or reminders) 30 90 90 60 120 Avery Okie Wizard Grainger Duran Total Revenues $260,000 $200,000 $322,000 $122,000 $212,000 $1,116,000 Technician and equipment cost 182,000 175,000 225,000 107,000 178,000 867,000 Gross Margin 78,000 25,000 97,000 15,000 34,000 249,000 Service call handling 11,250 18,000 3,000 9,000
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This note was uploaded on 11/02/2010 for the course AC 315 taught by Professor Emanuel during the Spring '10 term at Park.

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