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 (30%), skirts (29%), dresses (14%), and other (27%). Fleet Street has been using a volume-based rate to assign overhead to each product; the rate it uses is 2.37 per unit produced. The results for the trousers line, using the volume-based approach, are as follows:

Number of units produced	15,000
Price (all figures in )	27.02
Total revenue	405,300
Direct materials	66,700
Direct labor	222,600
Overhead (volume-based)	35,550
Total product cost	324,850
Nonmanufacturing expenses	60,600
Total cost	385,450
Profit margin for trousers	19,850

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	39,100
Grading	33,700
Lay planning	32,800
Sewing	37,400
Finishing	25,200
Inspection	11,100
Boxing up	6,000
Storage	12,000

Required:

1. Determine the profit margin for trousers using ABC.