Marketing Specialists Inc. (MSI) provides a range of services to their retail clients ? customer service for inquiries , ordering taking, credit checking for new customers,and a variety of related services.Auto Supermarket (AS) is a large auto dealer that provides financing for the autos and trucks that it sells.AS has approached MIS to manage the inquiries that come in regarding these loans.AS is not satisfied with the performance of the call center it currently uses for handling inquiries on these loans, and is considering a change to MSI.MSI has been asked to estimate the cost of providing the service for the coming year.

Marketing Specialists Inc. (MSI) provides a range of services to their retail clients - customer service for inquiries of related services. Auto Supermarket (AS) is a large auto dealer that provides financing for the autos and trucks There are two types of loans at AS, one for autos and SUVs and another for light trucks. The loans for auto and tr terms, so the nature and volume of the inquiries are expected to differ. MSI would use its own call center to ha Call Center Costs Salaries Utilities Leasing of Facilities Other Expenses $2,430,471 $1,324,774 $1,116,993 $393,170 $5,265,408 MSI's call center is staffed 12 hours per day and 60 call staff are always available during this 12 hour period. Each unpaid 60 minute break for a lunch/dinner during their 12 hour shift. Practical Capacity 7,894,828 Inquiries Inquire re: Rates and Terms Autos Trucks Inquire re: Loan App Status Autos Trucks Inquire re: Payment Status Autos Trucks Inquire re: Other Matter Autos Trucks Total Total Calls Answered 50,100 16,800 23,330 3,935 21,800 5,900 13,600 4,490 Suppose that in addition to the call center engagement outlined above, AS also provides service to 10 other clien Platinum Regional Bank Healthwise Software Inc. Johnson Manufacturing Lesco Online Shopping Babcock Insurance Service Garcia Electric Supply and Service Gilbert's Online Garden Supplies Financial Planning Services Inc. Porter's Camera and Optical Jordan Auto World Inc. Total Calls Answered 116,600 35,055 77,279 123,500 31,160 18,971 78,109 34,459 107,639 478,541 Required: 1. Determine the amount that MSI should propose to charge AS for the coming year using TDABC, assuming MSI Total Projected Costs/Practical Capacity The charge to AS should be estimated as follows: Desired profit First, the cost of engagement: Second, the selling price 2.Suppose that AS wants the proposal broken down by type of loan (auto, truck). What would the proposal look Inquiries Inquire re: Rates and Terms Autos Trucks Inquire re: Loan App Status Autos Trucks Inquire re: Payment Status Autos Trucks Inquire re: Other Matter Autos Trucks Total Total Calls Answered Avg. No. of Minutes/Call The revised proposal would show: Cost for Autos Cost for Trucks Total Cost Time markup Total Charge for Engagement 3.What is the unused capacity at MSI, not assuming that AS becomes a customer. Platinum Regional Bank Healthwise Software Inc. Johnson Manufacturing Lesco Online Shopping Total Calls Answered Babcock Insurance Service Garcia Electric Supply and Service Gilbert's Online Garden Supplies Financial Planning Services Inc. Porter's Camera and Optical Jordan Auto World Inc. Total Unused Capacity Call Center Practical Capacity Total minutes used with the AS engagement Unused capacity with the AS engagement 4.Assume that AS comes back to MSI with a revised proposal. The revised proposal includes call center activity a checking services for those who apply for loans at AS. AS expects the requirement for this service as follows. M Processing Credit Checks Auto Truck Inquiries Inquire re: Rates and Terms Autos Trucks Inquire re: Loan App Status Autos Trucks Inquire re: Payment Status Autos Trucks Inquire re: Other Matter Autos Trucks Total Requests 22,220 6,700 Min./request 5.0 8.0 Total Calls Answered Avg. No. of Minutes/Call Processing Credit Checks Auto Truck Total Processing Minutes Total Minutes for the Combined Engagement Minutes for other Clients Total Minutes Unused Capacity Call Center Capacity The cost of unused capacity could be determined as follows: - customer service for inquiries , ordering taking, credit checking for new customers, and a variety nancing for the autos and trucks that it sells. AS has approached MIS to manage the inquiries that trucks. The loans for auto and truck buyers typically have different types of customers and loan uld use its own call center to handle the AS engagement. The MSI call center's annual costs are as during this 12 hour period. Each staff has a paid 10 minute break for each hour worked, and an Avg. No. of Minutes/Call Total Time (minutes) 2.00 3.00 100,200 50,400 3.00 5.00 69,990 19,675 1.00 1.00 21,800 5,900 6.00 7.00 81,600 31,430 380,995 rovides service to 10 other clients, as described below in annual service: Avg. No. of Minutes/Call 3.0 2.0 2.0 3.0 2.7 2.1 2.0 6.0 3.0 1.0 ear using TDABC, assuming MSI desired a profit of 14% of incurred cost. What would the proposal look like now? Total Time (minutes) Autos Trucks Avg. No. of Minutes/Call Total Total sal includes call center activity as described, but in addition, AS wants MSI to provide error ent for this service as follows. MSI would use some of the call center staff, after appropriate Total Time (minutes) Autos Trucks Total Excel Instructions No additional Excel instructions No pivot tables, no tables/lists, no range names, no charts. sts, no range names, no charts