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    (Excel) Wilbur TinaACC650 T3

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    Tina Marie Wilbur
    Fresno Fiber Optics manufactures fiber optic cables and recently completed a customer profitability study using activity-based costing. The analysis found that Trace Telecom had $26,440 in customer-related costs while Caltex Computer had $31,820 in costs. Both customers had over $200,000 in sales revenue but Caltex Computer was more profitable after factoring in costs.

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    (Excel) Wilbur TinaACC650 T3

    Uploaded by

    Tina Marie Wilbur
    52 views1 page
    Fresno Fiber Optics manufactures fiber optic cables and recently completed a customer profitability study using activity-based costing. The analysis found that Trace Telecom had $26,440 in customer-related costs while Caltex Computer had $31,820 in costs. Both customers had over $200,000 in sales revenue but Caltex Computer was more profitable after factoring in costs.

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    (Excel)Wilbur_TinaACC650_T3

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    Fresno Fiber Optics manufactures fiber optic cables and recently completed a customer profitability study using activity-based costing. The analysis found that Trace Telecom had $26,440 in customer-related costs while Caltex Computer had $31,820 in costs. Both customers had over $200,000 in sales revenue but Caltex Computer was more profitable after factoring in costs.

    Copyright:

    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
    Download as xlsx, pdf, or txt
    52 views1 page

    (Excel) Wilbur TinaACC650 T3

    Uploaded by

    Tina Marie Wilbur
    Fresno Fiber Optics manufactures fiber optic cables and recently completed a customer profitability study using activity-based costing. The analysis found that Trace Telecom had $26,440 in customer-related costs while Caltex Computer had $31,820 in costs. Both customers had over $200,000 in sales revenue but Caltex Computer was more profitable after factoring in costs.

    Copyright:

    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
    Download as xlsx, pdf, or txt
    of 1

    Fresno Fiber Optics, Inc.

    manufactures fiber optic cables for the computer


    and telecommunication industries. At the request of the company VP of
    marketing, the cost management staff has recently completed a customer-
    profitability study. The following activity-based costing information was
    the basis for the analysis.

    Customer - Related Activities Cost Driver Base Cost Driver Rate


    Sales activity Sales visits $860
    Billing and Collection Invoices 160
    Order taking Purchase orders 220
    Special shipping Shipments 430

    Customer - Related Activities Trace Telecom Caltex Computer


    Sales activity 14 visits 18 visits
    Billing and Collection 22 invoices 26 invoices
    Order taking 26 orders 28 orders
    Special shipping 12 shipments 14 shipments

    Trace Telecom Caltex Computer


    Sales revenue $240,000 $226,000
    Cost of goods sold 140,000 110,000
    General selling costs 42,000 32,000
    General administrative costs 24,000 18,000

    Required:
    1. Prepare a customer profitability analysis for Trace Telecom and Caltex Computer.
    Customer related Trace Telecom Caltex Computer
    costs:

    $12,040.00 $15,480
    Sales activity
    Billing and Collection $3,520.00 $4,160.00
    Order taking $5,720.00 $6,160.00
    Special shipping $5,160.00 $6,020.00
    Total Customer
    Related Cost $ 26,440.00 $31,820

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