Problem:
Analysis shows that Xavier Corporation incurred the following five-year gross margin and cost histories in serving customer number 614.
Yr 1 Yr 2 Yr 3 Yr 4 Yr 5
Gross margin... $301000 $319000 $318000 $326000 $335000
Cost of engineer
-ing changes..... 3,300 6,060 3,500 3,600 40,125
Spl packaging...... 33,100 36,680 41300 39050 40,200
1. Prepare a trend analysis (in terms of percentage of gross margin) for these two customer-related costs
2. What different conclusion might management draw about the behvaior of these two costs?