Question

SkiBlu, Ltd., divides its customers into Gold customers and Silver customers. The company has one full-time customer representative per 1,000 Gold customers and one full-time customer representative per 10,000 Silver customers. Customer representatives receive salaries plus bonuses of 10 percent of customer gross margin. SkiBlu spends 80 percent of its promotion costs on Gold customers to encourage their loyalty. Total 68,000 Customer Costs Number of customers Average customer representative salary Promotion costs Average gross margin per customer Gold 48,000 $88,000 Silver 20,000 $88,000 $4,100,000 $ 750 $ 390 Required: a. Calculate the totals of the items below for both gold and silver customers, as well as the excess of gross margin over customer costs for each category. b. Which customers are more profitable? Complete this question by entering your answers in the tabs below. Required A Required B Calculate the totals of the items below for both gold and silver customers, as well as the excess of gross margin over customer costs for each category. (Do not round intermediate calculations.) Gold Silver Total gross margin Customer representative salaries & bonuses Promotion costs Excess of gross margin over customer costſ

Answer 1

+ SKIBlu la (Roa A Gold silves 1) TOTA GHOSS margin $ 36,000,000 7800000 2) customer rep salaries & bonuses 7824,000 956000 3) promotion costs 3280,000 820poo e- C excess of gross margin over customex cost 2,4896000 6,024,000 Explanation 0 GHƏoss meragin : GIO silves NO-OF Customer 148000 20000 AVG. GHBO SI morgin pes customes I 750 1390 toTCH Gross margin $ 36,000,000 7,800,000 customer representative Salaries & bonus: Gold silver No. of customer representative IC 48000 - 2000 20000 10,000 Avg customes aep salary Tore salary nad Bonus C36,000,000x10%7800,000 X 307] Total salary & Bonus 48 88000 4,224.000 8 8 8000 176000 $ 3600 000 780000 7824000 9 56000 (3) promotion cost: Gold: $ 4100,000 X 80% = silves: $41,00,000 & 80% = $3280ooo 820,000 Rog B Gold customers are more profitable