Fleet Street Inc., a manufacturer of high-fashion clothing for women, is located in South London in the UK. Its product line consists of trousers (32%), skirts (25%), dresses (13%), and other (30%). Fleet Street Inc. has been using a volume-based rate to assign overhead to each product; the rate it uses is 2.52 per unit produced. The results for the trousers line, using the volume-based approach, are as follows: Number of units produced 12,000 Price (all figures in ) 28.48 Total revenue 341,760 Direct materials 56,200 Direct labor 187,600 Overhead (volume-based) 30,240 Total product cost 274,040 Nonmanufacturing expenses 51,100 Total cost 325,140 Profit margin for trousers 16,620

Number of units produced

		12,000
Price (all figures in )		28.48
Total revenue		341,760
Direct materials		56,200
Direct labor		187,600
Overhead (volume-based)		30,240
Total product cost		274,040
Nonmanufacturing expenses		51,100
Total cost		325,140
Profit margin for trousers		16,620

Recently, it has conducted a further analysis of the trousers line of product, using ABC. In the study, eight activities were identified, and direct labor was assigned to the activities. The total conversion cost (labor and overhead) for the eight activities, after allocation to the trousers line, is as follows:

Pattern cutting

		34,860
Grading		30,000
Lay planning		29,300
Sewing		33,400
Finishing		22,500
Inspection		10,000
Boxing up		5,400
Storage		10,800
Determine the profit margin for trousers using ABC.