1. Compute the customer ABC rates.

2. Compute the customer type profitability per order for the delivery service under ABC costing.

What is the total ABC customer ABC activity cost assigned to each type of order?

3. What type of customer is more profitable per order?

Dynamic Delivery Inc. Dynamic Delivery Inc. delivers auto parts around a major metropolitan area. The company has a continuous improvement process. This year they decided to do an Activity-Based costing review of their delivery service. They have identified the following activity related information: Activity Expected Calculated Activity Cost Pools Measure Activity Levels Overheads $ Delivery service Kilometres 50,000 212,500 Delivery support Driver Hours 8,000 80,000 Order processing Orders 4,000 64,000 Dynamic Delivery has two main types of customers, Automotive Supply Stores and Auto Repair shops. The customer is invoiced for the order delivery based on the driver's recorded delivery times between pickup and delivery. Supply Stores Repair Shops Average service charge per delivery $ 150.00 $ 100.00 ABC Review Information Average distance per delivery Delivery driving time per order Parts Order Units Driver Hours Each Supply Stores 10 1.5 Repair Shops 6 1.0 1 1 Driver labour rate Per Hour $ 45.00