Question
Can anyone assist with the following assignment? 1. How do I prepare a customer profitability analysis for Trace Telecom and Caltex Computer. 2. Build a
Can anyone assist with the following assignment?
1. How do I prepare a customer profitability analysis for Trace Telecom and Caltex Computer.
2. Build a spreadsheet: Construct an Excel spreadsheet to solve requirement (1) below. Show how the solution will change if the following information changes: Trace Telecom's sales revenue was $185,000 and Caltex Computer's cost of goods sold was $59,000.
Problem 5-65 Customer-Profitability Analysis; Activity-Based Costing (LO 5-9)
1. Operating income, Trace Telecom: $7,000
Fresno Fiber Optics, Inc. manufactures fiber optic cables for the computer and telecommunications
industries. At the request of the company vice president of marketing, the cost management staff has
recently completed a customer-profitability study. The following activity-based costing information was
the basis for the analysis.
Customer-Related Activities Cost Driver Base Cost Driver Rate
Sales activity .................................................. Sales visits .................................................. $1,000
Order taking .................................................. Purchase orders ......................................... 200
Special handling ............................................ Units handled ............................................. 50
Special shipping ............................................ Shipments ................................................... 500
Cost-driver data for two of Fresno's customers for the most recent year are
Customer-Related Activities Trace Telecom Caltex Computer
Sales activity................................................... 8 visits....................................................... 6 visits
Order taking................................................... 15 orders..................................................... 20 orders
Special handling............................................. 800 units handled......................................... 600 units handled
Special shipping............................................. 18 shipments.............................................. 20 shipments
The following additional information has been compiled for Fresno Fiber Optics for two of its customers,
Trace Telecom and Caltex Computer, for the most recent year:
Trace Telecom Caltex Computer
Sales revenue................................................ $190,000................................................ $123,800
Cost of goods sold........................................ 80,000................................................ 62,000
General selling costs..................................... 24,000................................................ 18,000
General administrative costs........................ 19,000................................................ 16,000
Problem 5-65 should be prepared using Excel. Please note, you must show your work in Excel, which includes providing the formulas in the cells, not just the summary value. You may not earn full points if you do not show your work in detail
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