Thermal Rising Inc., makes paragliders for sale through specialty sporting goods stores. The company has a standard paraglider model but also makes custom design paragliders. Management has designed an activity-based costing system with the following activity cost pools and activity rates:

Supporting Direct Labor. $16 per direct labor hour

Order processing: $202 per order

Custom design processing: $ 267 per custom design

Customer service: $430 per customer

Management 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 Model Custom Design

Number of gliders 11 2

Number of orders 2 2

Number of custom designs 0 2

Direct labor hours per glider 26.50 34.00

Selling price per glider $ 1, 800 $ 2,400

Direct materials cost per glider: $ 482 $ 568

The company's direct labor rate is $22 per hour.

Required:

Using the company's activity-based costing system, compute the customer margin of Big Sky Outfitters.