Best Drugs is a distributor of pharmaceutical products. Its ABC system has five activities: EEB (Click the icon to view the activities.) Data table Activity Area 1. Order processing 2. Line-item ordering 3. Store deliveries 4. Carton deliveries 5. Shelf-stocking Cost Driver Rate in 2017 $42 per order $5 per line item $47 per store delivery $4 per carton $13 per stocking-hour I products. Its ABC quirements Rick Flair, the controller of Best Drugs, wants to use this ABC system to examine individual customer profitability within each distribution market. (Click the icon to view additional information.) Read the requirements. Use the ABC information to compute the operating income of each customer in August 2017. Comment on the results and what, if anything, Flair should do. Flair ranks the individual customers in the Ma and Pa single-store distribution market on the basis of monthly operating income. The cumulative operating income of the top 20% of customers is $58,120. Best Drugs reports operating losses of $23,670 for the bottom 40% of its customers. Make four recommendations that you think Best Drugs should consider in light of this new customer-profitability information. - X Requirement 1. Use the ABC information to compute the operating income of each customer in August 2017. Comment on the results and what, if anything, Flair should do. (Round your answers to the nearest whole dollar. Use parentheses or a minus sign for operating losses.) Revenues Cost of goods sold Gross margin Operating costs Operating income(loss) Ann Arbor Pharmacy San Diego Pharmacy has a lower gross margin percentage and consumes resources to obtain this lower margin. Requirement 2. Flair ranks the individual customers in the Ma and Pa single-store distribution market on the basis of monthly operating income. The cumulative operating income of the top 20% of customers is $58,120 Best Drugs reports operating losses of $23,670 for the bottom 40% of its customers. Make four recommendations that you think Best Drugs should consider in light of this new customer-profitability information 1. Pay attention to the top 20% of the customers. the rate per cost driver 2. Work out ways internally at Best Drugs to 3. Work with customers so that their behavior 4. Offer salespeople bonuses based on the ng the total "system-wide" costs of each customer rather than the gross margin of each customer