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ABC Corporation makes custom designed product for its customers. It has an activity-based costing system with four major activities. Data relating to the company's four
ABC Corporation makes custom designed product for its customers. It has an activity-based costing system with four major activities. Data relating to the company's four activity cost pools and activity rates are given below for the current year: Activity Cost Pool Activity Rate Supporting direct labor ...... Order processing Custom design processing ..... Customer service ..... $26 per direct labor-hour $284 per order $186 per custom design $379 per customer One of the company's customer, Cawker, Inc., has ordered the following products over the last 12 months: Number of products purchased Selling price per unit of product Direct materials cost per unit Direct labor-hours per unit of product Direct labor rate per hour Number of orders Number of customer design $2,400 $634 28 hours $19.50 Required: Compute the customer-level operating income of this customer for ABC Corporation using the company's activity-based costing system. Attach File Browse My Computer
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