Orozco Enterprises makes a variety of products that it sells to other businesses. The company's activity-based costing system has four activity cost pools for assigning costs to products and customers. Details concerning that ABC system are listed below:
The cost of serving customers, $1,793.00 per customer, is the cost of serving a customer for one year. Ellyson Corporation buys only one of the company's products. The details of last year's purchases of this product are listed below:
Required:
What is the customer margin on sales to Ellyson Corporation for the year?

Question

Orozco Enterprises makes a variety of products that it sells to other businesses. The company's activity-based costing system has four activity cost pools for assigning costs to products and customers. Details concerning that ABC system are listed below:
  The cost of serving customers, $1,793.00 per customer, is the cost of serving a customer for one year. Ellyson Corporation buys only one of the company's products. The details of last year's purchases of this product are listed below:
  Required:
What is the customer margin on sales to Ellyson Corporation for the year?

Quizplus · Accepted Answer

The Answer of Orozco Enterprises makes a variety of products that it sells to other businesses. The company's activity-based costing system has four activity cost pools for assigning costs to products and customers. Details concerning that ABC system are listed below:
  The cost of serving customers, $1,793.00 per customer, is the cost of serving a customer for one year. Ellyson Corporation buys only one of the company's products. The details of last year's purchases of this product are listed below:
  Required:
What is the customer margin on sales to Ellyson Corporation for the year?

Orozco Enterprises Makes a Variety of Products That It Sells