The gross profits per customer were $450 from customer 1; $450 from customer 2, and $450 from customer 3.

Use time-driven activity-based costing to answer the following question about KAR's costs and profitability:

Q2. How many hours of the Equipment resource did each customer consume?

Katie's Automobile Repair (KAR) provides automobile collision repair services. Katie Mac is the owner of the shop since her father Rick passed away in 2016. She basically grew up in the shop and learned "everything-automobile" from Rick. After she finishes her bachelor's degree in marketing, she wants the shop to start offering vehicle customizations and modifications, which was the dream she shared with her father. Currently, there are three primary activities at KAR: Preparation, Body Work, and Painting. The following table identifies the three overhead capacity resources used by the three activities. Capacity Resources Labourers Equipment Specialists 1420 Resource Hours Consumed Labourers Hours Equipment Hours Specialists Hours Cost per Year The following table identifies the number of hours of each overhead resource that one hour of each activity consumes: $40,000 $150,000 $80,000 Activity Hours Consumed Hours of Preparation Activity Hours of Body Work Activity Hours of Painting Activity Preparation 1.00 0.25 0.20 Hours per Year 2,000 3,000 0.80 1.00 For example, each hour of Preparation activity consumes 1.0 Labourers hour, 0.25 Equipment hours, and 0.20 Specialists hours. Customer 1 In addition to consuming overhead capacity resources, some activities consume supplies. The cost of these supplies is a variable cost that can be directly attributed to the use of the activity. Each hour of Body Work activity has a Supplies cost of $20. Each hour of Painting activity has a Supplies cost of $30. 2.00 1.00 0.50 Finally, the following table summarizes the number of hours of each activity consumed by recent repairs made for three customers: Painting 0.80 0.90 1.00 Customer 2 3.00 1.50 1.00 Customer 3 2.00 1.00 3.00