Question
May I please have help with the following homework problem? Please provide guidance/direction on how to calculate the profitability of Acme. Sample Case : Acme
May I please have help with the following homework problem?
Please provide guidance/direction on how to calculate the profitability of Acme.
Sample Case:
Acme analyzes profitability of each customer and order.It has determined the following are the average costs for each customer activity.
Order processing (per order)$8.00
Additional handling costs if order marked rush (per order)10.00
Customer service calls (per call)14.00
Relationship management costs (per customer per year)3,500
In addition to these costs, product costs amount to 85 percent of sales.
In 2020, the company had the following experience with Hanson Electronics, one of its customers:
Sales$54,000
Number of orders placed250
Percent of orders marked "rush"70%
Calls to customer service160 (what a pest!)
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