Answered step by step
Verified Expert Solution
Question
1 Approved Answer
CAN YOU PLEASE HELP ME WITH PART C !!! PLEASE !!! ILL GIVE THUMBS UP PLEASE Question 5 of 5 0.67 / 1 HII Sunland
CAN YOU PLEASE HELP ME WITH PART C !!! PLEASE !!! ILL GIVE THUMBS UP PLEASE
Question 5 of 5 0.67 / 1 HII Sunland Solutions, Inc. is an employment services firm that places both temporary and permanent workers with a variety of clients. Temporary placements account for 70% of Sunland Solutions' revenue permanent placements provide the remaining 30%. President Gia Johnson recently read an article that discussed the need to consider selling and administrative costs in determining customer profitability-a practice that Sunland Solutions does not follow. Johnson is concerned that the company may be making poor choices in the selection of customers In the temporary market, Sunland Solutions advertises and searches for workers, hires them, and pays them for the hours they work The company then bills customers for an amount that is higher than the workers' pay plus employment taxes. Because the temporary market is very competitive, Sunland Solutions has had to reduce the rates charged to customers to keep their business. After reviewing the year's operations, Johnson has determined that the company's customer service activities for the temporary business could be divided into three cost pools:filling work orders, hiring temporary employees, and processing payroll/billing customers. The following table shows the three cost pools and their annual capacity: Cost Pool Total Cost Annual Capacity Filling work orders $ 167,475 3,300 orders Hiring temporary employees 75,600 2,800 applicarlo Processing payroll/billing customers 41.250 165.000 hours worked $ $ Sunland Solutions' largest four customers account for about 52% of total sales, so Johnson has decided to analyze those customers' accounts first to determine how much they are contributing to the bottom line. The gross margin the companies generate and the activities they use are as follows: Chemical Company Trailer Manufacturer Newspaper Publisher Food Processor Sales $466,733 $ 145,764 $122.604 $167.327 Cost of sales Wages 341,620 110.473 92.205 120.451 Taxes and fees 65.366 24350 18671 0.67/1 111 Sunland Solutions' largest four customers account for about 52% of total sales, so Johnson has decided to analyze those customers accounts first to determine how much they are contributing to the bottom line. The gross margin the companies generate and the activities they use are as follows: Chemical Company Trailer Manufacturer Newspaper Publisher Food Processor Sales $ 466,733 $ 145,764 $ 122,604 $ 167,327 Cost of sales Wages 341.620 110.473 92.205 120,451 Taxes and fees 65,366 24,350 18,621 23,411 Total cost of sales 406,986 134823 110.826 143,862 $ 59,747 $10.941 $11.778 $ 23,465 Gross margin Temps ordered Applicants 90 60 932 332 72 48 794 284 Hours worked 47,370 15,115 13,000 22.765 (a) Your Answer Gordan JUJ 0.67/1 Ti Your answer is correct. Calculate the gross margin percentage for each customer. (Round answers to 1 decimal place, eg. 15.2%) Gross Margin % Chemical Company 12.80 %6 Trailer Manufacturer 7.51 % Newspaper Publisher 9.60 % Food Processor 14.02 % Solution Attempts: unlimited (b) Your answer is correct. Determine the activity rates for each of the three cost pools. (Round answers to 2 decimal places, es 15.25.) Cost Pool Activity Rate Filling work orders 50.75 per order Question 5 of 5 > 0.67/1 III per app Processing payroll/billing customers $ 0.25 per hour eTextbook and Media Attempts: unlimited (c) Determine the customer net profit and customer profit margin for each customer. (Round customer net profit to decimal places, es 125 and customer profit margin to 1 decimal place, c.8. 15.2%. Enter negative amounts using elther a negative sign preceding the number, 43-45 or parentheses, es: (451) Customer net profit Customer profit margin Chemical Company $ 96 Trailer Manufacturer $ 96 Newspaper Publisher $ 96 Food Processor $ 98 e Tectbook and Media Save for Attempts unlimited Submit Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started