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10. (10 points) Cheng Corp. collected the following data for three customers. HS AD Gross sales $50,000 $65,000 BW $80,000 Sales discounts 2% 3% 4%
10. (10 points) Cheng Corp. collected the following data for three customers. HS AD Gross sales $50,000 $65,000 BW $80,000 Sales discounts 2% 3% 4% Number of orders 100 312 125 Number of deliveries 10 80 50 Expedited orders 0 2 5 Sales visits 1 12 4 *Sales discounts are applied to customer Gross Sales Cheng Corp. gathered the following data pertaining to activities: Activity Order processing Delivery Cost Driver and Rate $75 per order $ 300 per delivery Expedited orders $ 500 per order $ 800 per visit Sales visits a. Calculate the Operating Income for each customer above. b. Based on this analysis, which customer is most important to Cheng's long-term profitability? Explain why you believe this customer to be most important
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