Exercise 7-10 (Algo) Customer Profitability Analysis (LO7-3, LO7-4, LO7-5) B. 3337 Worley Company buys surgical supplies from a variety of manufacturers and then resells and delivers these supplies to hundreds of hospitals. Worley sets its prices for all hospitals by marking up its cost of goods sold to those hospitals by 6%. For example, if a hospital buys supplies from Worley that cost Worley $100 to buy from manufacturers. Worley would charge the hospital 5106 to purchase these supplies. For years, Worley believed that the 6% markup covered its selling and administrative expenses and provided a reasonable profit. However, in the face of declining profits, Worley decided to implement an activity-based costing system to help Improve its understanding of customer profitability. The company broke its selling and administrative expenses into five activities as shown Activity cost. Pool (activity Measure) Total cost Total Activity Customer deliveries (Number of deliveries) $ 34, Manual order processing Number of manual orders) 4.600 deliveries 444,00 6.a onders Electronic order processing (unter of electronic orders) 255, ne 25, orders Line to picking (Nuber of line itens picked) 1,050.000 sce, line itens other organization.tustaining costs None) Total selling and administrative expenses 12.697,000 poed Elcok 600, a erences Unity 11 Mesra Worley gathered the data below for two of the many hospitals that it serves-University and Memortal (each hospital purchased medical supplies that had cost Worley $35,000 to buy from manufacturers Activity Activity Measure Number of deliveries 26 Number of manual orders Number of electronic orders Number of line itens picked 230 Required: 1. Compute the total revenue that Worley would receive from University and Memortal 2. Compute the activity rate for each actity cost pool. 3. Compute the total activity costs that would be assigned to University and Memorial 4. Compute Worleys customer margin for University and Memorial Hint Do not overlook the $35,000 cost of goods sold that Worley incurred serving each hospital) e 190 Complete this question by entering your answers in the tabs below. Required Mequired 2 Required Required 4 Compute the total revenue that Worley would receive from University and Memorial Total University Mamona Required 2 > Exercise 7-10 (Algo) Customer Profitability Analysis (LO7-3, LO7-4, LO7-5) B. 3337 Worley Company buys surgical supplies from a variety of manufacturers and then resells and delivers these supplies to hundreds of hospitals. Worley sets its prices for all hospitals by marking up its cost of goods sold to those hospitals by 6%. For example, if a hospital buys supplies from Worley that cost Worley $100 to buy from manufacturers. Worley would charge the hospital 5106 to purchase these supplies. For years, Worley believed that the 6% markup covered its selling and administrative expenses and provided a reasonable profit. However, in the face of declining profits, Worley decided to implement an activity-based costing system to help Improve its understanding of customer profitability. The company broke its selling and administrative expenses into five activities as shown Activity cost. Pool (activity Measure) Total cost Total Activity Customer deliveries (Number of deliveries) $ 34, Manual order processing Number of manual orders) 4.600 deliveries 444,00 6.a onders Electronic order processing (unter of electronic orders) 255, ne 25, orders Line to picking (Nuber of line itens picked) 1,050.000 sce, line itens other organization.tustaining costs None) Total selling and administrative expenses 12.697,000 poed Elcok 600, a erences Unity 11 Mesra Worley gathered the data below for two of the many hospitals that it serves-University and Memortal (each hospital purchased medical supplies that had cost Worley $35,000 to buy from manufacturers Activity Activity Measure Number of deliveries 26 Number of manual orders Number of electronic orders Number of line itens picked 230 Required: 1. Compute the total revenue that Worley would receive from University and Memortal 2. Compute the activity rate for each actity cost pool. 3. Compute the total activity costs that would be assigned to University and Memorial 4. Compute Worleys customer margin for University and Memorial Hint Do not overlook the $35,000 cost of goods sold that Worley incurred serving each hospital) e 190 Complete this question by entering your answers in the tabs below. Required Mequired 2 Required Required 4 Compute the total revenue that Worley would receive from University and Memorial Total University Mamona Required 2 >