Exercise 7-5. Second photo is less blurry.
Unit 7 pp 341 to 3... * 92.7% EXERCISE 7-5 Product and Customer Profitability Analysis L07-4, L07-5 Thermal Rising, Inc., makes paragliders for sale through specialty sporting goods stores. The com pany 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.. Activitate $26 per direct labor hour $284 per order $185 per custom design $379 per customer Management would like an analysis of the profitability of a particule customer, Big Sky Outfit ters, which has ordered the following products over the last 12 months Standard Model 20 1 Number of gliders Number of orders Number of custom designs Direct labor hours per glider Direct materials cost per glider Custom Design 3 3 3 28.00 $2.400 $634 26.35 31.850 The company's direct labore is $19.50 per hour 344 Chapter 7 Required Using the company's activity-based costing system, compute the customer margin of Big Sky Outfiners EXERCISE 7-6 Con Hierarchy LOT-1 CD lixpress, Inc. provides CD duplicating services for its customers. As order from a customer can be for a single copy or for thousands of coples. Most jobs are broken down into batches to allow smaller jobs, with higher priorities to have access to the machines A number of activities carried out at CD Express are listed below. Sales representatives periodic visits to customers to keep them informed about the services provided by CD Express bOrdering labels from the printer for a particular CD Setting up the CD duplicating machine to make coples from a particular master CD d. Loading the wtomatic labeling machine with labels for a particular CD 80 & Unit 7 pp 341 to 3... * 3 EXERCISE 7-5 Product and Customer Profitability Analysis LOV-4, LOT-5 Thermal Rising, Inc., males paragliders for sale through specialty sporting goods stores. The com pany 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 res: Activity Cost Pool Supporting direct labor Order processing Custom design processing Customer service Activity Rate 526 per direct labor hour $284 per order $186 per custom design $379 per customer Management would like an analysis of the profitability of a particular customer, Big Sky Outle- ters, which has ordered the following products over the last 12 months Standard Model 20 1 Number of giders Number of orders Number of custom designs Direct inbor hours per glider Selling price puder Direct materials cost per gider Custom Design 3 3 3 20.00 $2.400 26:35 $1.850 $944 The company's direct laborrate is $19.50 per hour 344 Chapter 7 Required Using the company's activity-based costing system compute the customer margin of Big Sky Outfies. EXERCISE 7-6 Cost Hierarchy L07 CD Express, Inc. provides CD duplicating services for its customers. An order from a customer can be for a single copy or for thousands of copies. Most jobs are broken down into butches to allow aller jobs, with higher priorities, to have access to the machines A number of activities carried out at CD Express are listed below. Sales representatives periodic visits to customers to keep them informed about the services provided by CD Express b. Ordering labels from the printer for a particular CD. Setting up the CD duplicating machine to make coples from a particular master CD d. Loading the automatic labeling machine with labels for a particular CD. 30 3 4
