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Activity-Based Customer-Driven Costs Suppose that Stillwater Designs has two classes of distributors: JIT distributors and nonJIT distributors. The JIT distributor places small, frequent orders, and
Activity-Based Customer-Driven Costs Suppose that Stillwater Designs has two classes of distributors: JIT distributors and nonJIT distributors. The JIT distributor places small, frequent orders, and the nonJIT 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 activitles and costs for the most recent quarter: JIT NonJIT Distributors 700 70 350 750 $125 Distributors Sales orders Sales calls Service calls Average order size Manufacturing cost/unit Customer costs: 70 70 175 7,500 $125 Processing sales orders Selling goods Servicing goods $3,080,000 1,120,000 1,050,000 5,250,000 Total
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