Enviro-Tech has only two retail and two wholesale customers. Information relating to each customer for 2012 follows (in thousands):

	Wholesale Customers		Retail Customers
	North America	South America	Green	Global
	Wholesaler	Wholesaler	Energy	Power
Revenue at list prices	$375,000	$590,000	$175,000	$130,000
Discounts from list prices	25,800	47,200	8,400	590
Cost of goods sold	285,000	510,000	144,000	95,000
Delivery costs	4,550	6,710	2,230	2,145
Order processing costs	3,820	5,980	2,180	1,130
Cost of sales visit	6,300	2,620	2,620	1,575

EnviroTech's annual distribution-channel costs are $33million for wholesale customers and $12million for retail customers. The company's annualcorporate-sustaining costs, such as salary for top management andgeneral-administration costs, are $48million. There is no cause-and-effect orbenefits-received relationship between any cost-allocation base andcorporate-sustaining costs. That is EnviroTech could save corporate-sustaining costs only if the company completely shuts down.

Requirements

1.	Calculate customer-level operating income.
2.	Prepare a customer-cost hierarchy report.
3.	Enviro minus TechEnviroTech's management decides to allocate all corporate-sustaining costs to distribution channels . Calculate the distribution-channel-level operating income. On the basis of these calculations, what actions, if any, should EnviroTech's managers take? Explain.
4.	How might Enviro minus TechEnviroTech use the new cost information from its activity-based costing system to better manage its business?