Sunshine Ltd is a manufacturer of raincoats. It has two major retail customers: City Rain...
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Accounting
Sunshine Ltd is a manufacturer of raincoats. It has two major retail customers: City Rain and Urban Drench. Information regarding the two customers is given below: Sunchine incurs selling, general and administrative (SG\&A) expenses of $400,000, which is related to two customer-driven activities: sales or processing and advertising support. The data associated with both customer-driven activities is as follows: a. What is the net customer profitability of City Rain based on the net revenue approach? (1 mark) (Give your answer to 2 decimal places) b. According to the activity-based costing approach, what is the SG\&A expense related to Sales order that should be allocated to Urban Drench? (1 mark) (Give your answer to 2 decimal places)
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