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Maclin Supermarkets (MS) operates at capacity and decides to apply ABC analysis to three product lines: baked goods, milk and fruit juice, and frozen foods. It identifies four activities and their activity cost rates as follows: A (Click the icon to view the activity cost rates.) The revenues, cost of goods sold, store support costs, activities that account for the store support costs, and activity-area usage of the three product lines are as follows: (Click the icon to view the information for the three product lines.) Read the requirements, Requirement 1. Use the simple costing system to prepare a product-line profitability report for MS. (Round the percentages to the nearest hundredth percent, XXX%.) Milk and Frozen Baked Goods Fruit Juice Products Total Revenues Costs Cost of goods sold Store support Total costs Operating Income Operating Income/Revenues % % % - More info Ordering Delivery and receipt of merchandise Shelf-stocking Customer support and assistance $104 per purchase order $82 per delivery $18 per hour $0.24 per item sold Print Done Data table Milk and Baked Goods Fruit Juice Frozen Products Financial data Revenues $ 61,000 $ 65,000 $ 50,500 Cost of goods sold 39,000 $ 46,000 $ 33,000 Store support 11,700 $ 13,800 $ 9,900 Activity-area usage (cost-allocation base) Ordering (purchase orders) 20 15 5 Delivery (deliveries) 100 40 35 Shelf-stocking (hours) 195 170 15 Customer support (items sold) 15,500 19,375 7,000 Under its simple costing system, MS allocated support costs to products at the rate of 30% of cost of goods sold. 1. Use the simple costing system to prepare a product-line profitability report for MS. 2. Use the ABC system to prepare a product-line profitability report for MS. 3. What new insights does the ABC system in requirement 2 provide to MS managers

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