Workshape 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 activities and costs for the previous quarter are as follows: Activity JIT distributors Non-JIT distributors Sales Orders 500 30 Sales Calls 30 30 Service Calls 200 90 Average Order Size 90 1,400 Manufacturing Cost/Unit $50 $50 ​ ​ ​ ​ ​ ​ Customer Costs: ​ ​ Processing Sales Orders $160,000 ​ Selling Goods $155,000 ​ Servicing Goods $195,000 ​ Total $500,000 ​ Calculate the total customer cost for the non-JIT distributors. (Note: Round the activity rates and activity costs to the nearest dollar.)   a. $175,200   b. $150,025   c. $147,030   d. $122,500   e. $178,791

Question
  1. Workshape 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 activities and costs for the previous quarter are as follows:

    Activity

    JIT distributors

    Non-JIT distributors

    Sales Orders

    500

    30

    Sales Calls

    30

    30

    Service Calls

    200

    90

    Average Order Size

    90

    1,400

    Manufacturing Cost/Unit

    $50

    $50

    Customer Costs:

    Processing Sales Orders

    $160,000

    Selling Goods

    $155,000

    Servicing Goods

    $195,000

    Total

    $500,000

    Calculate the total customer cost for the non-JIT distributors. (Note: Round the activity rates and activity costs to the nearest dollar.)

      a.
    $175,200
      b.
    $150,025
      c.
    $147,030
      d.
    $122,500
      e.
    $178,791
     

 

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