Could you please tell me requirement a percentages?
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More info Customer 1 is a long-time customer with sales of $120,000 at list prices. This customer takes advantage of each discount or allowance listed in the preceding table. Moreover, this customer has been a loyal customer since Krum Company's inception. In appreciation, Krum's sales representative offers free freight, which amounts to 3% of the customer's listprice purchases from Randolph. Customer 2 is a more recently acquired customer with sales of $2,000,000 at list prices. This customer only takes advantage of items 1,3 , and 5 in the preceding table. More info Requirement (a) Compute the total sales discount percentage for Customer 1 and for Customer 2. The total sales discount percentage for Customer 1 is % and the total sales discount percentage for Customer 2 is %. Requirement (b) Why might Krum Company's management team have been unaware of the potentially large total discounts offered to its customers? Krum Company's management may have been unaware of the potentially large discounts offered to its customers because the discounts and allowances arise from and are recorded in systems. In addition, the may occur at various times of the year. For example, the prompt payment discount may be recorded by the finance department in the finance department may lump all freight costs into a general labeled as transportation expenses. The department may initiate the cooperative advertising allowance, volume discount allowance, and rebates. With 10 manager sees the complete picture for individual orders and consequently no one realizes how much revenue loss occurs with individual orders. Requirement (c) What advice do you have for Krum Company regarding managing its discounts and allowances? Once firms become aware of pricing waterfalls leading to undesirably large sales discounts, they can use their activity-based costing systems to as well promotional costs and allowances, to individual orders and customers in order to calculate realized profit or loss by order or by customer. Using this information, companies can periodically every customer. Furthermore, companies can use the on MSDA costs to base salesperson incentives on order and customer profits, not just sales. More info Customer 1 is a long-time customer with sales of $120,000 at list prices. This customer takes advantage of each discount or allowance listed in the preceding table. Moreover, this customer has been a loyal customer since Krum Company's inception. In appreciation, Krum's sales representative offers free freight, which amounts to 3% of the customer's listprice purchases from Randolph. Customer 2 is a more recently acquired customer with sales of $2,000,000 at list prices. This customer only takes advantage of items 1,3 , and 5 in the preceding table. More info Requirement (a) Compute the total sales discount percentage for Customer 1 and for Customer 2. The total sales discount percentage for Customer 1 is % and the total sales discount percentage for Customer 2 is %. Requirement (b) Why might Krum Company's management team have been unaware of the potentially large total discounts offered to its customers? Krum Company's management may have been unaware of the potentially large discounts offered to its customers because the discounts and allowances arise from and are recorded in systems. In addition, the may occur at various times of the year. For example, the prompt payment discount may be recorded by the finance department in the finance department may lump all freight costs into a general labeled as transportation expenses. The department may initiate the cooperative advertising allowance, volume discount allowance, and rebates. With 10 manager sees the complete picture for individual orders and consequently no one realizes how much revenue loss occurs with individual orders. Requirement (c) What advice do you have for Krum Company regarding managing its discounts and allowances? Once firms become aware of pricing waterfalls leading to undesirably large sales discounts, they can use their activity-based costing systems to as well promotional costs and allowances, to individual orders and customers in order to calculate realized profit or loss by order or by customer. Using this information, companies can periodically every customer. Furthermore, companies can use the on MSDA costs to base salesperson incentives on order and customer profits, not just sales
