Figure 7-2

Multiple Choice

Figure 7-2.Steller 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:

-Refer to Figure 7-2. Calculate the activity rate for servicing goods.

A) $1,089 per service call
B) $750.10 per service call
C) $675.50 per service call
D) $1,000 per service call
E) $711.54 per service call