Smith Company sells its products at $540 per unit, net 30. The firm's gross margin...
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Smith Company sells its products at $540 per unit, net 30. The firm's gross margin ratio is 40 percent. The firm has estimated the following operating costs: Activity Sales calls Order processing Deliveries Sales returns Cost Driver and Rate $ 420 per visit $ 110 per order $ 60 per order + $0.50 per mile $ 70 per return and $3 restocking per unit returned Smith Company has gathered the following data pertaining to activities it performed for two of its customers: XBT 12 520 NINTO 2 2,020 Number of orders Number of parts per order Sales returns: Number of returns Number of units returned (per return) Number of sales calls Miles per delivery Shipping terms 4 10 50 6 40 8 10 FOB, Factory 20 FOB, Destination What is Smith's total sales-sustaining cost applicable to XBT as a customer
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