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Colleen Company has gathered the following data pertaining to activities it performed for two of its major customers. Jerry, Incorporated 4 1,000 Kate Company 60

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Colleen Company has gathered the following data pertaining to activities it performed for two of its major customers. Jerry, Incorporated 4 1,000 Kate Company 60 130 Number of orders Units per order Sales returns: Number of returns Total units returned Number of sales calls 3 2 40 13 200 4 Colleen sells its products at $190 per unit. The firm's gross margin ratio is 25%. Both Jerry and Kate pay their accounts promptly and no accounts receivable is over 30 days. After using business analytics software to carefully analyze the operating data for the past 30 months, the firm has determined the following activity costs: Activity Sales calls Order processing Deliveries Sales returns Sales salary Cost Driver and Rate $800 per visit 490 per order 500 per order 210 per return and $5 per unit returned 109,000 per month Required: 1. Using customers as the cost objects, classify the activity costs into cost categories (unit-level, batch-level, etc.) and compute the total cost for Colleen Company to service Jerry, Incorporated and Kate Company. 2. Compare the profitability of these two customers

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