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Thermal Rising, Inc, makes paragliders for sale through specialty sporting goods stores. The company has a standard paraglider model, but also makes custom-designed paragliders. Management
Thermal Rising, 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 activitybased costing system with the following activity cost pools and activity rates: Activity Cost Pool Activity Rate Supporting direct labor 3; 26 per direct labor-hour Order processing 5. 234 per order Custom design processing $ 136 per custom design Customer service 3; 37'9 per customer Management would like an analysis of the protability of a pa rticular customer, Big Sky Outfitters, which has ordered the following products over the last 12 months: Standard Custom Model Design Number of gliders 20 3 Number of orders 1 3 Number of custom designs 3 3 Direct laborhours per glider 26.35 28.80 Selling price per glider $1,356 $2,406 Direct materials cost per glider S 564 $ 634 ' The company's direct labor rate is $19.50 per hour. Required: Using the company's activity-based costing system, compute the customer margin of Big Sky Outfitters. [Round your intermediate calculations and final answer to the nearest whole dollar amount.)
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