PWC Systems Inc. makes personal watercraft for sale through specialty sporting goods stores. The company has a standard model but also makes custom-designed models. Management has designed an ABC system with the following activity cost pools and activity rates:

Activity Cost Pool

Activity Rates

Supporting manufacturing

$ 20

per direct labour-hour

Order processing

$214

per order

Custom design processing

$240

per custom design

Customer service

$319

per customer

Management would like an analysis of the profitability of a particular customer, WaveRider, which has ordered the following products over the last 12 months:

Standard

Model

Custom

Design

Number of watercraft

17

5

Number of orders

2

5

Number of custom designs

0

5

Direct labour-hours per watercraft

22.5

21.0

Selling price per watercraft

$11,800

$14,400

Direct materials cost per watercraft

$8,550

$9,360

The company's direct labour rate is $24 per hour.

Using the company's ABC system, compute the customer margin of WaveRider.

Sales

Costs:

Direct materials

Direct labour

Supporting manufacturing

Order processing

Custom designing

Customer service