Question
Can you please give me all the calculations. Everytime I work this problem I come up with a diffrent number which is not correct. Please
Can you please give me all the calculations. Everytime I work this problem I come up with a diffrent number which is not correct. Please help!
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 $18per direct labor-hour
Order processing $200per order
Custom designing processing $262per custom design
Customer service $424per 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 Custom
Mode Design
Number of gliders 15 3
Number of orders 2 3
Number of custom designs 0 3
Direct labor-hours per glider 27.50 33.00
Selling price per glider $1,700 $2,310
Direct materials cost per glider $444 $584
The companys direct labor rate is $22 per hour.
Required:Using the companys 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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