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Assignment
Assume the following activity based system information :
Customer related activities
Cost driver base
Cost driver rate
Customer 1
Customer 2
Sales Activity
Sales visits
1000
8 visits
6 visits
Order Taking
Purchase Order
200
15 orders
20 orders
Special handling
Units Handled
50
800 units handled
600 units handled
Special shipping
Shipments
500
18 shipments
20 shipments
Sales Revenue
190,000
123,000
COGS
80,000
62,000
General selling costs
24,000
18,000
General administrative costs
19,000
16,000
Operating Income
67,000
27,000
Prepare the customer flexibility analysis for customers 1 and 2
Additional information for six other customers as follow:
Customer 3
Customer 4
Customer 5
Customer 6
Customer 7
Customer 8
Operating income
71,000
-18,000
60,000
42,000
93,000
6,000
Prepare the customer profitability graph
Prepare the customer profitability profile
Comment on the result
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