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9.54 Change in customer segments (L01). NScN Sanitation offers waste management services for residential and commercial clients. The following select operating data are available: W Number ofcustomers 500 100 600 Number of pickups per week 500 500 1,000 Revenue $800,000 $1 200,000 $2,000,000 Variable costs $140,000 $240,000 $380,000 Traceable xed costs $150,000 $225,000 $375,000 Common xed costs NA NA $1,100,000 Believing its commercial customers to be more protable, N&N is thinking of mov- ing its business more toward that business segment. Management would like to see a mix of 200 residential and 300 commercial clients in three years\" time. Required: 3. Estimate the change in prot arising from the change in product mix, assuming that that traceable and xed common costs do not change from current levels. b. Suppose N3cN believes that, in the long run, xed costs would change in proportion to sales revenue. Calculate the expected prot with the new customer mix. Allocate common xed costs in proportion to the revenue from the two segments when performing this exercise. c. Repeat the exercise in part (b), except allocate common xed costs to segments and in proportion to the number of pickups from each segment. That is, assume that pickups are the cost driver for traceable and common xed costs. :1. Which of the three estimates, for parts (a) through (c), is likely to be a good estimate of N&N's prots three years hence if it changes its customer mix as indicated