value: 1.00 points Thermal Rising, Inc., makes paragliders for sale through specialty sporting goods stores. The company has a standard paraglider model, but also makes custom-designed paragliders. Management has designed an activity-based costing system with the following activity cost pools and activity rates: Activity Cost Pool Activity Rate Supporting direct labor $ 22 per direct labor-hour Order processing $ 182 per order Custom designing processing $ 268 per custom design Customer service $ 426 per customer Management would like an analysis of the profitability of a particular customer, Big Sky Outfitters, which has ordered the following products over the last 12 months: Standard Model Custom Design Number of gliders 15 2 Number of orders 2 2 Number of custom designs 0 2 Direct labor-hours per glider 27.50 34.00 Selling price per glider $ 1,700 $ 2,350 Direct materials cost per glider $ 444 $ 570 The companyâs direct labor rate is $22 per hour. Required: Using the companyâs activity-based costing system, compute the customer margin of Big Sky Outfitters. (Do not round intermediate calculations.)
what is the customer margin?
value: 1.00 points Thermal Rising, Inc., makes paragliders for sale through specialty sporting goods stores. The company has a standard paraglider model, but also makes custom-designed paragliders. Management has designed an activity-based costing system with the following activity cost pools and activity rates: Activity Cost Pool Activity Rate Supporting direct labor $ 22 per direct labor-hour Order processing $ 182 per order Custom designing processing $ 268 per custom design Customer service $ 426 per customer Management would like an analysis of the profitability of a particular customer, Big Sky Outfitters, which has ordered the following products over the last 12 months: Standard Model Custom Design Number of gliders 15 2 Number of orders 2 2 Number of custom designs 0 2 Direct labor-hours per glider 27.50 34.00 Selling price per glider $ 1,700 $ 2,350 Direct materials cost per glider $ 444 $ 570 The companyâs direct labor rate is $22 per hour. Required: Using the companyâs activity-based costing system, compute the customer margin of Big Sky Outfitters. (Do not round intermediate calculations.)
what is the customer margin?
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Updraft Systems, Inc., makes paragliders for sale throughspecialty sporting goods stores. The company has a standardparaglider model, but also makes custom-designed paragliders.Management has designed an activity-based costing system with thefollowing activity cost pools and activity rates: |
Activity CostPool | Activity Rate | ||
Supporting directlabor | $ | 18 | per direct labor-hour |
Orderprocessing | $ | 190 | per order |
Customdesigning | $ | 265 | per custom design |
Customerservice | $ | 422 | per customer |
Management would like an analysisof the profitability of a particular customer, Eagle Wings, whichhas ordered the following products over the last 12 months: |
Standard Model | Custom Design | |||
Number ofgliders | 12 | 3 | ||
Number oforders | 2 | 3 | ||
Number of customdesigns | 0 | 3 | ||
Direct labor-hoursper glider | 26.50 | 32 | ||
Selling price perglider | $ | 1,725 | $ | 2,370 |
Direct materialscost per glider | $ | 472 | $ | 568 |
The companyâs direct labor rateis $20 per hour. |
Required: |
Using the companyâs activity-based costing system, compute thecustomer margin of Eagle Wings.(Leave no cells blank - becertain to enter "0" wherever required. Loss amount should beindicated with a minus sign. Do not round intermediatecalculations. Round your final answer to the nearest dollar amount.Omit the "$" sign in your response.) |
Customer margin | $ |
Foam Products, Inc., makes foam seat cushions for the automotiveand aerospace industries. The companyâs activity-based costingsystem has four activity cost pools, which are listed below alongwith their activity measures and activity rates:
Activity Cost Pool | ActivityMeasure | Activity Rate | ||
Supporting direct labor | Numberof direct labor-hours | $5.55 | perdirect labor-hour | |
Batch processing | Number ofbatches | $ 107.00 | per batch | |
Order processing | Number oforders | $ 275.00 | per order | |
Customer service | Number ofcustomers | $ 2,463.00 | percustomer | |
The company just completed asingle order from Interstate Trucking for 1,000 custom seatcushions. The order was produced in two batches. Each seat cushionrequired 0.25 direct labor-hours. The selling price was $20 perunit, the direct materials cost was $8.50 per unit, and the directlabor cost was $6.00 per unit. This was Interstate Truckingâs onlyorder during the year. |
Required: |
Prepare a report showing the customer margin on sales toInterstate Trucking for the year. (Round your final answersto 2 decimal places.) |
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