nstructions Schneider Electric manufactures power distribution equipment for commercial customers, such as hospitals and manufacturers. Activity-based costing was used to determine customer profitability. Customer service activities were assigned to individual customers, using the following assumed customer service activities, activity base, and activity rate: Customer Service Activity Activity Base Bid preparation Number of bid requests Activity Rate $400 per request Shipment Support standard items Support nonstandard items Number of shipments Number of standard items ordered Number of nonstandard items ordered $80 per shipment $25 per std. tom $150 per nonstd. item Assume that the company had the following gross profit information for three representative customers Customer 1 Customer 2 Customer 3 Revenue $120,000.00 $200,000.00 $160,000.00 Cost of goods sold 76,800.00 110,000.00 Gross profit $43,200.00 $90,000.00 83,200.00 $76,800.00 Gross profit as a percent of sales 36.0% 45.0% 48.0% Instructions cross proves The administrative records indicated that the activity-base usage quantities for each customer were as follows: Activity Base Customer 1 Customer 2 Customer 3 Number of bid requests 14 Number of shipments 30 Number of standard items ordered 15 Number of nonstandard items ordered 5 70 322 38 55 60 48 30 50 80 Required: a. Prepare a customer profitability report dated for the year ended December 31, 20Y8, showing (1) the income from operations after customer service activities, (2) the gross profit as a percent of sales, and (3) the income from operations after customer service activities as a percent of sales. Prepare the report with a column for each customer. Refer to the Labels and Amount Descriptions for exact wording of text entries. Be sure to complete the statement heading Enter all amounts as positive numbers, except for a negative income from operations. Round percentages to the one decimal place. Colons will appear automatically b. Interpret the report in part (a). Check My Work Ins Labels and Amount Descriptions Sc Labels Cu As Customer service activities December 31, 20Y8 For the Year Ended December 31, 20Y8 Amount Descriptions Bid preparation Cost of goods sold Gross profit Income from operations after customer service activities Post-sale customer service Revenues Sales order processing Shipment Support standard items Support nonstandard items Total customer service activities a. Prepare a customer profitability report dated for the year ended December 31, 20Y8, showing (1) the income from operations after customer service activities, (2) the gross profit as a percent of sales, and (3) the income from operations after customer service activities as a percent of sales. Prepare the report with a column for each customer. Refer to the Labels and Amount Descriptions for exact wording of text entries. Be sure to complete the statement heading. Enter all amounts as positive numbers, except for a negative income from operations. Round percentages to the one decimal place. Colons will appear automatically. Question not attempted. 1 2 3 4 5 (Label) Schneider Electric Customer Profitability Report (Label) Score: 0/179 Customer 1 Customer 2 Customer 3 Customer Profitability Report Shaded cells have feed 6 (Label) 10 = 11 12 Gross profit as a percentage of sales 13 Income from operations after customer service activities as a percent of sales Points: 0/44