Problem 1 (Total: 28 marks) Troy Stationery Limited manufactured a specialized ballpen, which is sold in boxes. Troy has decided to analyze the profitability of five new customers. The full cost of manufacturing a box of the specialized ballpen is $21. Troy sells the ballpens to retail customers at a list price of $26 per box. Data pertaining to the five customers are: Customer A B C D E Boxes sold 1,850 6,800 44,500 31,200 1.900 List selling price $ 26 $ 26 $26 $ 26 $26 Actual selling price $ 0 $ 0.8 $1.7 $0.2 $2.1 Number of purchase orders 10 18 35 16 35 Number of customer visits 3 5 12 4 12 Delivery kilometres travelled 168 112 520 150 1575 Number of rush deliveries 0 0 0 0 3 Troy Stationery Limited's five activities and their cost drivers are: Required: (i) (ii) (iii) (iv) Activity Cost-Driver Rate Order taking Customer visits Regular deliveries Product handling Rush deliveries $88 per purchase order $73 per customer visit $3 per delivery kilometre travelled $1 per box sold $380 per rush delivery Calculate the customer-level operating income for these five customers in a customer profitability analysis format. (14 marks) Prepare a six-column cumulative customer-profitability profile by ranking the customers from most to least profitable. (4 marks) Discuss the results of your customer-profitability analysis. (5 marks) What insights do managers gain by reporting both the list selling price and the actual selling price for these five customers? (5 marks)