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Topic: Customer Profit Analysis Question: Using CPA, the ranking of the customers would be? with solution please, thank you Customer profitability analysis 46S Ltd manufactures

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Topic: Customer Profit Analysis

Question: Using CPA, the ranking of the customers would be?

with solution please, thank you

Customer profitability analysis 46S Ltd manufactures components for the aircraft industry. The following annual information regarding three of its key customers is available: Gross margin General administration costs Units sold Orders placed Sales visits Invoices raised P1,100,000 40,000 1,750 1,000 110 900 P1,750,000 80,000 2,000 1,000 100 1,200 P1,200,000 30,000 1,500 1,500 170 1,500 The company uses an activity based costing system and the analysis of customer-related costs is as follows: Sales visits P500 per visit Order processing P100 per order placed Dispatch costs P100 per order placed Billing and collections P175 per invoice raised

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