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Foam Products, Incorporated, makes foam seat cushions for the automotive and aerospace industries. The company's activity-based costing system has four activity cost pools, which
Foam Products, Incorporated, 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 Supporting direct labor Number of direct labor-hours Batch processing Order processing Customer service Number of batches Number of orders Number of customers Activity Rate $11 per direct labor-hour $ 97 per batch $ 285 per order $ 2,622 por customer The company just completed a single order from Interstate Trucking for 2,400 custom seat cushions. The order was produced in five batches. Each seat cushion required 0.5 direct labor-hours. The selling price was $141.90 per unit, the direct materials cost was $112 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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