FIND CUSTOMER MARGIN

.._.'. __._ _. _..._ -..... 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 Activity Rates Supporting manufacturing $ 3 per direct labour-hour Order processing $15 per order Customer service $56 per customer Management would like an analysis ofthe protability of a particular customer, Cell City, which has ordered the following products over the last 12 months: Standard Deluxe Model Model Number of cases 126 35 Number of orders 5 2 Direct labour-hours per case 8.26 8.46 Selling price per case 5 35 $ 55 Direct materials cost per case $ 16 $ 12 The company's direct labour rate is $19 per hour. Required: Using the company's ABC system, compute the customer margin of Cell City. :|