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Nerrod Company sells its products at $630 per unit, net 30. The firm's gross margin ratio is 50 percent. The firm has estimated the following
Nerrod Company sells its products at $630 per unit, net 30. The firm's gross margin ratio is 50 percent. The firm has estimated the following operating costs: | ||||||||||
Activity | Cost Driver and Rate | |||||||||
Sales calls | $500 | per visit | ||||||||
Ordering processing | $130 | per order | ||||||||
Deliveries | $62 | per order + | $.65 | per mile | ||||||
Sales returns | $76 | per return + | $3.73 | restocking per unit returned | ||||||
Nerrod Company has gathered the following data pertaining to activities it performed for two of its customers: | ||||||||||
XBT | NINTO | |||||||||
Number of orders | 12 | 2 | ||||||||
Number of parts per order | 630 | 2,490 | ||||||||
Sales returns | ||||||||||
Number of items | 4 | 12 | ||||||||
Number of units returned | 51 | 62 | ||||||||
Number of sales calls | 7 | 12 | ||||||||
Miles per delivery | 13 | 24 | ||||||||
Shipping terms | FOB, Factory | FOB, Destination | ||||||||
What is Nerrod's total customer batch-level cost applicable to Ninto? |
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