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Donna Company makes three types of products. The company has two types of customers. The cost to serve all customers is $12,000 and is allocated
Donna Company makes three types of products. The company has two types of customers. The cost to serve all customers is $12,000 and is allocated to customer types based on the number of manager visits to customer locations. The following data are available: Product 1 Product 2 Sales $5,000 $6,000 Cost of goods sold 4.000 4.800 Gross margin $1,000 $1,200 Customer Type 1 Product 1 Sales Product 2 Sales $500 $1,000 Product 3 Sales Manager visits $16,000 4 What is the operating income for all three products for Customer Type 1? A $5,900 $5,850 OC $9,600 00 $2,400 Product 3 $30,000 15.000 $15,000 Customer Type 2 $4,500 $5,000 $14,000 16
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