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Exercise 7-14 Second-Stage Allocation and Margin Calculations (LO3, LO4) Roll Board Inc, manufactures several models of high-quality skateboards. The company's ABC system has four activity
Exercise 7-14 Second-Stage Allocation and Margin Calculations (LO3, LO4) Roll Board Inc, manufactures several models of high-quality skateboards. The company's ABC system has four activity cost pools, which are listed below along with their activity measures and activity rates: 25 points Activity Cost Pool Supporting direct labour Batch processing Order processing Customer service Activity Measure Number of direct labour-hours Number of batches Number of orders Number of customers Activity Rate $ 11 per direct labour-hour $ 89 per batch $ 170 per order $1,290 per customer eBook References The company just completed a single order from SkateCo for 3,700 entry-level skateboards. The order was produced in 31 batches. Each skateboard required 0.5 direct labour-hours. The selling price was $130 per skateboard, the direct materials cost was $77.40 per skateboard, and the direct labour cost was $18.40 per skateboard. This was the only order from SkateCo for the year. Required: Prepare a report showing the customer margin on sales to SkateCo for the year. Sales Costs: Direct materials Direct labour Supporting direct labour Batch processing Order processing Customer service overhead Customer margin
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