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Question 4: Best company supplies furniture to three local retailers, Danny, Penner, and Victor Inc. The following exhibit presents representative revenues and costs of Best
Question 4: Best company supplies furniture to three local retailers, Danny, Penner, and Victor Inc. The following exhibit presents representative revenues and costs of Best by customers for the year 2019. Additional information on Best's costs for different activities at various levels of the cost hierarchy is as follows: Danny $540,000 370,000 47,000 Penner $340,000 220,000 20,000 Victor $450,000 380,000 37,000 Total $1,330,000 $970,000 $104,000 Sales Cost of goods sold Materials-handling labour Materials-handling equipment (Cost written off as amortization) Rent Marketing support Purchase orders and delivery processing General administration Total operating costs Operating income 10,000 14,000 12,000 13,000 20,000 486,000 S54,000 6,000 8,000 9,000 7,000 12,000 282,000 $58.000 8,000 14,000 11,000 12,000 16,000 478.000 -$28,000 $24,000 $36,000 $32,000 $32,000 $48,000 $1,246,000 $84.000 Materials handing labour costs vary with the number of units of furniture shipped to customers. Question 4: Best company supplies furniture to three local retailers, Danny, Penner, and Victor Inc. The following exhibit presents representative revenues and costs of Best by customers for the year 2019. Additional information on Best's costs for different activities at various levels of the cost hierarchy is as follows: Danny $540,000 370,000 47,000 Penner $340,000 220,000 20,000 Victor $450,000 380,000 37,000 Total $1,330,000 $970,000 $104,000 Sales Cost of goods sold Materials-handling labour Materials-handling equipment (Cost written off as amortization) Rent Marketing support Purchase orders and delivery processing General administration Total operating costs Operating income 10,000 14,000 12,000 13,000 20,000 486,000 S54,000 6,000 8,000 9,000 7,000 12,000 282,000 $58.000 8,000 14,000 11,000 12,000 16,000 478.000 -$28,000 $24,000 $36,000 $32,000 $32,000 $48,000 $1,246,000 $84.000 Materials handing labour costs vary with the number of units of furniture shipped to customers
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