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Colleen Company has gathered the following data pertaining to activities it performed for two of its major customers. Jerry, Inc. 6 2,000 Kate Co. 60
Colleen Company has gathered the following data pertaining to activities it performed for two of its major customers. Jerry, Inc. 6 2,000 Kate Co. 60 340 Number of orders Units per order Sales returns: Number of returns Total units returned Number of sales calls 4 6 150 40 12 3 Colleen sells its products at $200 per unit. The firm's gross margin ratio is 20%. 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 390 per order 140 per order 220 per return and $6 per unit returned 107,000 per month Complete this question by entering your answers in the tabs below. Required 1 Required 2 Compare the profitability of these two customers. (Loss amounts should be indicated by a minus sign. Round operating margin (loss) to 2 decimal places (i.e. .2134 should be entered as 21.34%).) Jerry Inc. Kate Co. Sales Sales return x Net sales $ 0 $ 0 $ 0 x 0 X A A A A 0 Cost of goods sold Gross margin Sales support costs Operating income (loss) Operating margin (loss) 0 $ 0 X % X% *Red text indicates no response was expected in a cell or a formula-based calculation is incorrect; no points deducted
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