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compute the customer margin Check 5 Thermal Rising, Inc., makes paragliders for sale through specialty sporting goods stores. The company has a standard paraglider model,
compute the customer margin
Check 5 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 Supporting direct labor Order processing Custom design processing Customer service Activity Rate $ 22 per direct labor-hour $ 192 per order $ 256 per custom design $ 428 per customer 3ook Hint rint 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: "ences Number of gliders Number of orders Number of custom designs Direct labor-hours per glider Selling price per glider Direct materials cost per glider Standard Custom Model Design 14 3 1 3 3 27.50 33.00 $ 1,825 $ 2,440 $ 476 $ 574 The company's direct labor rate is $16 per hour. RequiredStep by Step Solution
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