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Colby Company makes cases for cell phones of all sizes and types for sale through specialty retailers. The company makes a standard model for

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Colby Company makes cases for cell phones of all sizes and types for sale through specialty retailers. The company makes a standard model for the most recent iPhone as well as a deluxe model. Management has designed an ABC system with the following activity cost pools and activity rates for these models: Activity Cost Pool Order processing Supporting manufacturing Customer service Activity Rates $2 per direct labour-hour $25 per order $66 per customer Management would like an analysis of the profitability of a particular customer, Cell City, which has ordered the following products over the last 12 months: Standard Deluxe Number of cases Number of orders Direct labour-hours per case Selling price per case Direct materials cost per case The company's direct labour rate is $25 per hour. Required: Model Model 250 85 5 2 0.25 $ 45 0.40 $ 65 $ 22 $ 25 Using the company's ABC system, compute the customer margin of Cell City. 5 points 1 Skipped Number of cases Number of onders Direct labour hours per case Selling price per case, Direct materials cost per case The company's direct labour rate is $26 per hour. Required: Standard Deluxe 2 Model Model 250 85 5 0.25 0.40 $45 $ 65 $ 22 $25 Using the company's ABC system, compute the customer margin of Cell City. Sales Costs Direct materials Direct labour Supporting manufacturing Order processing Customer service Customer margin 0 S 0

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