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Activity-Based Customer-Driven Costs Suppose that Stillwater Designs has two classes of distributors: JIT distributors and non-JIT distributors. The JIT distributor places small, frequent orders,
Activity-Based Customer-Driven Costs Suppose that Stillwater Designs has two classes of distributors: JIT distributors and non-JIT distributors. The JIT 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: Sales orders Sales calls Service calls IT Distributors Non-JIT Distributors 700 70 70 70 350 175 750 7,500 $125 $125 Average order size Manufacturing cost/unit Customer costs: Processing sales orders $3,430,000 Selling goods 1,120,000 1,050,000 $5,600,000 Servicing goods Total Required: 1. Calculate the total revenues per distributor category, and assign the customer costs to each distributor type by using revenues as the allocation base. Selling price fo one unit is $150. Round calculations to the nearest dollar. Sales (in units) JIT Non-JIT
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