Use the following information to complete Exercises below:
Terra Turf (TT) is a manufacturer of artificial turf for athletic facilities. TT has contracts with 3 universities to install and maintain the turf on the football fields. The fields are essentially identical, so TT management has assumed that all costs would be equal for each customer. However, after missing budget predictions this year, the CFO decided to use ABC costing principles to evaluate the profitability of their customers.
The cost accounting team has put together the following estimates regarding specific cost activities related to maintenance of turf fields:
The universities are all out-of-state but relatively equidistant from the manufacturing plant, so per-trip travel costs are not considered to be significantly different. However, each university has different expectations regarding maintenance of the turf, and TT has collected the following data for each customer:
Assume that each of the three customers produces gross profits of $100,000.
-Which customer is the least profitable?

Question

Use the following information to complete Exercises below: 
Terra Turf (TT) is a manufacturer of artificial turf for athletic facilities. TT has contracts with 3 universities to install and maintain the turf on the football fields. The fields are essentially identical, so TT management has assumed that all costs would be equal for each customer. However, after missing budget predictions this year, the CFO decided to use ABC costing principles to evaluate the profitability of their customers.
The cost accounting team has put together the following estimates regarding specific cost activities related to maintenance of turf fields:
  The universities are all out-of-state but relatively equidistant from the manufacturing plant, so per-trip travel costs are not considered to be significantly different. However, each university has different expectations regarding maintenance of the turf, and TT has collected the following data for each customer:
  Assume that each of the three customers produces gross profits of $100,000.
-Which customer is the least profitable?

Quizplus · Accepted Answer

The Answer of Use the following information to complete Exercises below: 
Terra Turf (TT) is a manufacturer of artificial turf for athletic facilities. TT has contracts with 3 universities to install and maintain the turf on the football fields. The fields are essentially identical, so TT management has assumed that all costs would be equal for each customer. However, after missing budget predictions this year, the CFO decided to use ABC costing principles to evaluate the profitability of their customers.
The cost accounting team has put together the following estimates regarding specific cost activities related to maintenance of turf fields:
  The universities are all out-of-state but relatively equidistant from the manufacturing plant, so per-trip travel costs are not considered to be significantly different. However, each university has different expectations regarding maintenance of the turf, and TT has collected the following data for each customer:
  Assume that each of the three customers produces gross profits of $100,000.
-Which customer is the least profitable?

Use the Following Information to Complete Exercises Below