Question
Windows of the World (WoW) sells and delivers new windows to construction sites in the Midwest. Each window is sold for $130. In addition, WoW
Windows of the World (WoW) sells and delivers new windows to construction sites in the Midwest. Each window is sold for $130. In addition, WoW charges a flat fee of $5 per window for shipping and handling. Some customers are happy with the arrangement while others are leaving. The owner of WoW, Jack, decides to take a closer look at the situation and hires a consultant to do the job. The consultant compiles the data on shipping and handling for the second quarter and prepares the following table:
A. I already did.
B. I already did.
C.What will be your recommendation changes to WoW's shipping and handling pricing policy.?
NEED HELP WITH THIS PART ------>>>>>Recommend changes to WoWs shipping and handling pricing policy.
Activity Entering order Packaging order Delivering order Performing general delivery administration Activity Cost S 24,000 S 22,500 S 30.800 S 39,000 $ Cost Driver Volume 1,200 orders 15,000 windows 1,400 deliveries 1,950,000 order value $ $ $ Cost Driver Rate 20 per order 2 per item 22 per delivery 2% of value Activity Cost Driver Rate Entering order Packaging order Delivering order Performing general delivery administration Total delivery costs $20 per order $ 2 per item $22 per delivery 2% of value Ray Jerry Driver Volume Activity Cost Driver Volume Activity Cost 45 $ 900 14 $ 280 2,000 $ 3,000 2.000 $ 3,000 55 $ 1,210 14 $ 308 S 260,000 $ 5,200 $ 260,000 $ 5,200 $ 10,310 $ 8,788 $Step by Step Solution
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