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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 Activity Measure Activity Rate Supporting direct Number of direct labor labor-hours $ 9 per direct labor-hour Batch processing Number of batches $ 9 7 per batch Order processing Number of orders $ order Customer service Number of customers $ 2,6 O 3 per customer 2 8 5 per The company just completed a single order from Interstate Trucking for 2,100 custom seat cushions. The order was produced in three batches. Each seat cushion required 0.6 direct labor-hours. The selling price was $141.80 per unit, the direct materials cost was $102 per unit, and the direct labor cost was $14.40 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. Interstate Trucking Customer Margin-ABC Analysis Costs: Customer margin
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