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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 customdesigned paragliders. Management designed an activitybased costing system with the following activity cost pools and activity rates:
tableActivity Cost Pool,Activity RateSupporting direct labor,$ per direct laborhourOrder processing,$ per orderCustom design processing,$ per custom designCustomer service,$ per customer
Management wants to calculate the profitability of a particular customer. Big Sky Outfitters, which ordered the following products over the last months:
tabletableStaMotablendardodelCustom,DesignNumber of gliders,,Number of orders,,Number of custom designs,,Direct laborhours per glider,,Selling price per glider,,$Direct materials cost per glider,,$
The company's direct labor rate is $ per hour.
Required:
Using the company's activitybased costing system, compute the customer margin of Big Sky Outfitters.
Note: Round your intermediate calculations and final answer to the nearest whole dollar amount. Loss amounts should be entered with o minus sign.
Customer margin
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