Customer profitability, service company. (20-30 minutes) Overloon, BV, is a repaif-service company specialising in the rapid repair of photocopying machines. Each of its 10 clients pays a fixed monthly service fee

(based on the type of photocopying machines owned by that client and the number of employees at that site). Overloon keeps records of the time technicians spend at each client as well as the cost of the equipment used to repair each photocopying machine. Overloon recently decided to calculate the profitability of each customer. The following data Gin thousands) pertain to May 2000: mki56

REQUIRED 1. Calculate the operating profit of each customer. Prepare exhibits for Overloon that are similar to Exhibits 12-10 and 12-11. Comment on the results.

2. What options regarding individual customers should Overloon consider in light of your customer-profitability analysis in requirement 1?
3. What problems might Overloon encounter in accurately estimating the operating cost of each customer?

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CUSTOMER CUSTOMER REVENUES COSTS Hytop, BV Koninklijk Nederlands Meteorologisch Instituut EUR 260 EUR 182 180 184 Hoogovens Scrap Processing 163 178 Borgh Pensioen Consultancy 322 225 Edah Supermarkten 235 308 Hogeschool Eindhoven 80 74 Koninklijk Instituut voor de Marine 174 100 Eindhovens Dagblad 76 108 Randmeer College 137 110 NRC Handelsblad 373 231