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Thermal Rising, Incorporated, makes paragliders for sale through specialty sporting goods stores. The company has a standard paraglider model, but also makes custom - designed

Thermal Rising, Incorporated, 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: Thermal Rising, Incorporated, 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:
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:
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. (Round your intermediate
calculations and final answer to the nearest whole dollar amount. Loss amounts should be entered with a minus sign.)
Answer is complete but not entirely correct.
Activity Cost Pool Activity Rate
Supporting direct labor $ 18 per direct labor-hour
Order processing $ 190 per order
Custom design processing $ 264 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 102
Number of orders 12
Number of custom designs 02
Direct labor-hours per glider 27.5031.00
Selling price per glider $ 1,950 $ 2,460
Direct materials cost per glider $ 478 $ 570
The companys direct labor rate is $22 per hour.
Required:
Using the companys 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. Loss amounts should be entered with a minus sign.)
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