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Ariana produces custom widgets for its customers. The company uses an activity-based costing system for its overhead costs. The company has provided the following data
Ariana produces custom widgets for its customers. The company uses an activity-based costing system for its overhead costs. The company has provided the following data regarding its indirect costs from its activity-based costing system. The "Other" activity cost pool consists of costs of idle capacity \& organization-sustaining costs. One particular customer, Lipa, requested 35 jobs during the year for a total of 12 units, requiring a total of 192 machine hours. Each unit requires $0.68 in direct materials and $1.62 in direct labor. The customer was charged $3804 for these jobs. Compute the customer margin for Lipa if they used traditional costing instead of ABC on the basis of machine hours. Round ONLY your final answer to the nearest whole dollar amount. Do not round intermediate calculations. Enter a positive or negative number based on your results. HINT: to compute the total predetermined application rate for traditional costing, divide the total of the indirect costs by the total activity base
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