jhon peter Submitted 2019-01-10 06:24:50 Contribution to general and selling expenses = number of cartons ordered * (general and selling expenses + Interest expenses)cartons processed Customer ACustomer B Sales103 New England Patriots Vapor Untouchable Jerseys ,000104,000 Cost of Items Purchased94,442.96109,562 Contribution to general and selling expenses, and profit200*2 New England Patriots Color Rush Jerseys ,120,00080,000= =53005300 Profit3257.04- (10,862) What explains and difference in profitability between the two customers? method of delivery (customer B chooses much more expensive delivery for 50 cartons) -Number of orders made by different number of clients Customer A had 12 customers placing an order for 200 cartons b) Customer B had 100 customers placing an order for 200 cartons More different customers placing orders means much higher costs (cost per order is $102.08). So Customer A spend $1224.96 and Customer B spend $102,08 which is $8983.04 more money spent on Customer B. What are the limitations Jake Bailey Color Rush Jersey , if any, to estimates of the profitability of the two customers? Lack of information about distance taken for 鈥渄esktop鈥?delivery, so we can鈥檛 compute Delivery per Labor Hour because each time there is different distance form the warehouse which makes different cost per delivery. Is there any additional information you would like to have to explain the relative profitability of the two customers Hours spend on delivery which means Delivery per Labor Hour -To now the wages or number of personnel Number of personnel working in each activity (for example if all orders going to be place thru EDI then we can know how many employees we can fire. Assume that Dakota applies the analysis done in question 3 to its entire customer base. How could such information help the Dakota managers increase company profits? If they would apply to analysis from question 3 the managers would discover that delivery cost is incorrect and the price for 鈥渄esktop鈥?delivery should be higher or abdicative to the distance where the order is placed. -Make higher prices and for the customers who are placing big orders there should be a discount to eliminate high number of customer placing small orders. -Correct the cost of whole process by determining direct labor hour. Suppose that major customer switched form placing all its orders manually to placing all its orders over the interest site. How should this affect the activity cost driver rates calculated in question 2? How would the switch affect Dakota鈥檚 profitability? It would affect Activity One: process cartons in and out of the facility and the driver-cost rate would change. Rate=EDI OrdersEDI Labor Hours Rate=8,000500=16 ordersper hour So we would have spend Total OrdersOrders per hour = 24,00016=1500 hours of work and when we compare to 10 Hjalte Froholdt Color Rush Jersey ,000 hours spend before we have worked 8,500 hour less so its 85% less money we spend on wages. It also would affect the Activity Four: Data Entry because while using EDI costs would reduce and so the same cost per line would decrees. -The Profitability would be much higher because two out of four allocation base activity cost would decline so each customer would improve the profit and also number of customers placing small orders wouldn鈥檛 affect that dramatically the profit. -Also there should be bather way of collecting bills from customers so that the interest rate from credit wouldn鈥檛 affect the yearly profit.
Net Novice No More Internet Articles | August 15, 2004 A relative novice when it came to the ... not too long ago I didn?t have a clue where to start when trying to create a website or why I had the need for one. Luckily though, with time and practi
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