Fleet Street Incorporated a manufacturer of high-fashion clothing for women, is located in South London in the UK. Its product line consists of trousers (33%), skirts (32%), dresses (10%), and other (25%). Fleet Street has been using a volume-based rate to assign overhead to each product; the rate it uses is 2.36 per unit produced. The results for the trousers line, using the volume-based approach, are as follows:

Number of units produced	13,000
Price (all figures in )	27.61
Total revenue	358,930
Direct materials	59,000
Direct labor	197,000
Overhead (volume-based)	30,680
Total product cost	286,680
Nonmanufacturing expenses	53,600
Total cost	340,280
Profit margin for trousers	18,650

Recently, Fleet Street 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	34,380
Grading	29,400
Lay planning	28,600
Sewing	32,800
Finishing	21,700
Inspection	9,600
Boxing up	5,200
Storage	10,400

Required:

1. Determine the profit margin for trousers using ABC.