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Foam Products, Inc., makes foam seat cushions for the automotive and aerospace industries. The companys 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 companys activity-based costing system has four activity cost pools, which are listed below along with their activity measures and activity rates:

Activity Cost Pool

Activity Measure

Activity Rate

Supporting direct labor

Number of direct labor-hours

$5.55 per direct labor-hour

Batch processing

Number of batches

$107.00 per batch

Order processing

Number of orders

$275.00 per order

Customer service

Number of customers

$2,463.00 per customer

The company just completed a single order from Interstate Trucking for 1,000 custom seat cushions. The order was produced in two batches. Each seat cushion required 0.25 direct labor-hours. The selling price was $20 per unit, the direct materials cost was $8.50 per unit, and the direct labor cost was $6.00 per unit. This was Interstate Truckings only order during the year.

Required:

Calculate the customer margin on sales to Interstate Trucking for the year.

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