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Foam Products, Inc., makes foam seat cushions for the automotive and aerospace industries. The company's activity-based costing system has four activity cost pools, which are
Foam Products, Inc., makes foam seat cushions for the automotive and aerospace industries. The company's activity-based costing system has four activity cost pools, which are listed below along with their activity measures and activity rates: Activity Cost Pool Supporting direct labor Batch processing Order processing Customer service Activity Measure Activity Rate Number of direct labor-hours Number of batches Number of orders Number of customers 12 per direct labor-hour $ 95 per batch $273 per order $2,638 per customer The company just completed a single order from Interstate Trucking for 2,600 custom seat cushions. The order was produced in four batches. Each seat cushion required 0.4 direct labor-hours. The selling price was $141.60 per unit, the direct materials cost was $107 per unit, and the direct labor cost was $14.20 per unit. This was Interstate Trucking's only order during the year Required Calculate the customer margin on sales to Interstate Trucking for the year
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