Activity-Based Customer Costing Sleepeze Company produces mattresses for 20 retail outlets. Of the 20 retail outlets, 19 are small, separately owned furniture stores and one is a retail chain. The retail chain buys 60% of the mattresses produced. The 19 smaller customers purchase mattresses in approximately equal quantities, where the orders are about the same size. Data concerning Sleepeze's customer activity are as follows: Large Retailer Smaller Retailers Units purchased 108,000 72,000 Orders placed 36 3,600 Number of sales calls 18 882 Manufacturing costs $43,200,000 $28,800,000 Order filling costs allocated* $1,455,127 $970,085 Sales force costs allocated* $ 719,820 $479,880 *Currently allocated on sales volume (units sold). Currently, customer-driven costs are assigned to customers based on units sold, a unit-level driver. Required: Assign costs to customers by using an ABC approach. Round your answers and all intermediate calculations to the nearest dollar. Order filling rate 700 X per order Selling call rate 1,500 X per sales call Required: Assign costs to customers by using an ABC approach. Round your answers and all intermediate calculations to the nearest dollar. Order filling rate $ 700 X per order Selling call rate 1,500X per sales call Cost assignment: Large retailer 52,200 x Smaller retailers 3,843,000 x Feedback Check My Work Determine the rate per activity by dividing the total cost of the activity by the total number of activity drivers. Assign costs to each customer type by applying the activity rate to the activity drivers per customer type.

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