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Please explain all the process of calculation in detail, I hope to learn through this website not just to get the answers thank you. Colby
Please explain all the process of calculation in detail, I hope to learn through this website not just to get the answers thank you.
Colby Company makes cases for cell phones of all sizes and types for sale through specialty retailers. The company makes a standard model for the most recent iPhone as well as a deluxe model. Management has designed an ABC system with the following activity cost pools and activity rates for these models: Activity Cost Pool Activity Rates Supporting manufacturing $ 2 per direct labour-hour Order processing $10 per order Customer service $51 per customer Management would like an analysis of the profitability of a particular customer, Cell City, which has ordered the following products over the last 12 months: Number of cases Number of orders Direct labour-hours per case Selling price per case Direct materials cost per case Standard Model 100 5 0.25 $ 30 S 7 Deluxe Model 10 2. 0.40 $ 50 $ 10 The company's direct labour rate is $10 per hour. Required: Using the company's ABC system, compute the customer margin of Cell CityStep by Step Solution
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