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Healthy Paper Delivery has decided to analyze the profitability of five new customers. It buys recycled paper at $12 per case and sells to
Healthy Paper Delivery has decided to analyze the profitability of five new customers. It buys recycled paper at $12 per case and sells to retail customers at a list price of $15.40 per case. Data pertaining to the five customers are: (Click the icon to view the data.) Healthy Paper Delivery's five activities and their cost drivers are as follows: (Click the icon to view the activities and cost drivers.) Required Data table Requirement 1. Compute the customer-level operating income of each of the five retail customers now being examined (1, 2, 3, 4, and 5). Begin by calculating each customer's gross margin. Then, calculate the operating income for each customer. (Complete all input fields. Ente 1 2 Cases sold 2,050 8,850 Customer 3 61,200 4 5 32,300 2,700 1 2 3 5 Revenues at list price 31,570 $ 136,290 $ List selling price Actual selling price $15.40 $15.40 $15.40 $15.40 $15.40 $15.40 $15.06 $13.40 $14.87 $13.95 942,480 $ 497,420 $ 41,580 Price discounts 3,009 122,400 17,119 3,915 Number of purchase orders Number of customer visits 13 25 38 29 34 1 2 8 1 4 Revenues at actual prices 31,570 133,281 820,080 480,301 37,665 Number of deliveries 15 35 68 38 34 Cost of goods sold 24,600 106,200 734,400 387,600 32,400 Kilometres travelled per delivery 22 9 10 10 37 Gross margin 6,970 27,081 85,680 92,701 5,265 Number of expedited deliveries 0 0 0 0 3 Product handling Order taking Deliveries - X Data table Expedited deliveries Customer visits Total cust-level oper. costs Total customer-level operating costs Customer-level operating income (loss) Activity Order taking Customer visits Deliveries Product handling Expedited deliveries Cost Driver Rate $200 per purchase order $80 per customer visit $3 per delivery kilometre travelled $0.70 per case sold $350 per expedited delivery - X
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