Calumet''s phone costs for individual customers

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Reference no: EM1311168

Computing cost of usage per customer using the data given.

Calumet Inc is investigating its phone ordering costs and hoping to trace those costs to each of its three customer types, individuals, book stores and internet sales. Calumet uses in-house phone service for regular hours questions and orders and an outside source for weekend evening phone service.

		Individual		Internet
Calumet Inc Phone Information	Total	Customers	Book Stores	Sales
Phone Hours	60,000	30,000	18,000	12,000
In house phone time		40%	80%	10%
Outside phone time		60%	20%	90%
In-house phone time	$276,000
Outside phone service costs	$583,000
Total phone service costs	$859,000

Calumet's phone costs (rounded) for Individual Customers are

a. $144,000
b. $208,800
c. $206,400
d. $444,000

Reference no: EM1311168

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