Question
A financial analyst for Simon Manufacturing prepared the following report: Customers Customer- Level Operating Income Customer Revenue A $5646.00 $26,250 B $4773.00 $30,000 C $3705.00
A financial analyst for Simon Manufacturing prepared the following report:
Customers Customer-
Level Operating Income Customer Revenue
A $5646.00 $26,250
B $4773.00 $30,000
C $3705.00 $15,000
D $1155.50 $7,300
E $984.80 $5,100
F $844.80 $4,400
G $336.60 $1,800
H $252.00 $4,500
I ($168.00) $2,400
J ($676.00) $2,600
Which of the following conclusions can be drawn from the report?
All profitable customers achieve customer level operating income in excess of 20%
Customer B has the second highest operating income margin
The cumulative customer-level operating income of the top eight customers represents about 105.0% of operating income
All customers provide positive contribution towards profitability
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