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Sky Drivers Inc., makes paragliders for sale through specialty sporting goods stores. The company has a standard paraglider model, but also makes custom - designed

Sky Drivers Inc., makes paragliders for sale through specialty sporting goods stores. The company has a standard paraglider model, but also makes custom-designed paragliders. Management has designed an activity-based costing system with the following activity cost pools and activity rates:Activity Cost PoolActivity RateSupporting direct labor$ 26 per direct labor-hourOrder processing$ 290 per orderCustom design processing$ 190 per custom designCustomer service$ 400 per customerManagement would like an analysis of the profitability of a particular customer, Big Sky Outfitters, which has ordered the following products over the last 12 months:Standard ModelCustom DesignNumber of gliders255Number of orders.14Number of custom designs4Direct labor-hours per glider.32Selling price per glider$ 2,500Direct materials cost per glider$50028.00$ 3,000$ 600The company's direct labor rate is $21.00 per hour.Required:Using the company's activity-based costing system, compute the customer margin of Big SkyOutfitters.

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