Moustache Manufacturing Has Two Classes of Distributors: JIT Distributors and Non-JIT

question 52

Multiple Choice

Moustache 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 found below:
$$\begin{array} { l r r } & \text { JIT } & \text { Non-JIT } \\\text { Sales Orders } & 300 & 20 \\\text { Sales Calls } & 25 & 25 \\\text { Service Calls } & 150 & 75 \\\text { Average Order Size } & 100 & 1,000 \\\text { Manufacturing Cost/Unit } & \$ 50 & \$ 50\end{array}$$ $$\begin{array}{l}\text { Customer Costs: }\\\begin{array} { l l } \text { Processing Sales Orders } & \$ 200,000 \\\text { Selling Goods } & \$ 120,000 \\\text { Servicing Goods } & \$ 150,000 \\\text { Total } & \$ 470,000\end{array}\end{array}$$
-Refer to the Figure.What is the activity rate for servicing goods?

• A)$650 per service call
• B)$667 per service call
• C)$675 per service call
• D)$2,000 per service call

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Definitions:

Nuclear Medicine

A medical specialty involving the use of radioactive substances in diagnosis and treatment of diseases.

Radionuclides

Unstable atoms that emit radiation as they break down, used in medical imaging, cancer treatment, and as tracers in scientific research.

Diagnosis

The process of identifying a disease or condition from its symptoms and signs through examination and various diagnostic tests.

Roentgen Rays

Refers to X-rays.