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Activity Based Customer-Driven Cost Suppose that Stillwater Designs has two classes of distributors IT datributors and non-IT distributors. The IT distributor places small, frequent
Activity Based Customer-Driven Cost Suppose that Stillwater Designs has two classes of distributors IT datributors and non-IT distributors. The IT distributor places small, frequent orders, and the non-IT distributor tends to place larger less frequent orders. Both types of distributors are buying the same product. Stillwater Designs provides the following information about customer-related activities and costs for the most recent quarter Non-IT Distributors JIT Distributors Sales orders Sales calls 900 90 70 70 Service cas 350 175 Average order size 850 8.500 Manufacturing cost/unt $125 $125 Customer costa Processing sales orders $3,530,000 Seling goods 1,120,000 1,050,000 $5,700,000 Servicing goods T Required 1. Calculate the total revenues per distributar ceegory, and assign the customer costs to each distributor type by using revenues as the allocation base. Selling price for one unit is $150 Round calculations to the near dola Sales) Sa Non-IT
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