Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Nerrod Company sells its products at $500 per unit, net 30. The firm's gross margin ratio is 40 percent. The firm has estimated the following
Nerrod Company sells its products at $500 per unit, net 30. The firm's gross margin ratio is 40 percent. The firm has estimated the following operating costs: Activity Sales calls Order processing Deliveries Sales returns Cost Driver and Rate $400 per visit $100 per order $ 50 per order + $0.50 per mile $ 60 per return and $3 restocking per unit returned Nerrod Company has gathered the following data pertaining to activities it performed for two of its customers: XBT 10 500 NINTO 2 2,000 Number of orders Number of parts per order Sales returns: Number of returns Number of units returned Number of sales calls Miles per delivery Shipping terms 4 40 6 10 FOB, Factory 10 50 10 29 FOB, Destination What is Nerrod's total customer-sustaining cost applicable to Ninto? Multiple Choice $400 O $6.300 $6,420 $600, $4,000
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started