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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 activity-based costing system with the following activity cost pools and activity rates:

Activity Cost Pool Activity Rate
Supporting direct labor $ 16 per direct labor-hour
Order processing $ 188 per order
Custom design processing $ 256 per custom design
Customer service $ 424 per customer
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 28.50 32.00
Selling price per glider $ 1,675 $ 2,380
Direct materials cost per glider $ 456 $ 576

The companys direct labor rate is $20 per hour. Using the companys activity-based costing system, compute the customer margin of Big Sky Outfitters.

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