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Wiley Manufacturing has two classes of distributors: JIT distributors and non-JIT distributors. The JIT distributor places small, frequent orders, and the non-JIT distributor tends to
Wiley Manufacturing has two classes of distributors: JIT distributors and non-JIT distributors. The JIT distributor places small, frequent orders, and the non-JIT distributor tends to place larger, less frequent orders. Both types of distributors purchase the same product. The customer-related activities and costs for the previous quarter are as follows: Activity Sales orders Sales calls JIT Distributors Non-JIT Distributors 500 30 30 30 Service calls 200 90 Average order size 90 Manufacturing cost/unit $50 1,400 $50 Customer costs: Processing sales orders $160,000 Selling goods 155,000 195,000 Servicing goods Calculate the total customer cost for the non-JIT distributors. (Round activity rates and activity costs to the nearest dollar.) Oa. $147,030 Ob. $175,200 Oc. $150,025 Od. $122,500
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