Thermal Rising Inc makes paragliders for sale through specia

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 $ 16 per direct labor-hour Supporting direct labor Order processing Custom design processing Customer service 192 per order $ 254 per custom design $ 432 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 Custom ModelDesign Number of gliders Number of orders Number of custom designs Direct labor-hours per glider Selling price per glider Direct materials cost per glider 33.00 $ 1,600 $2,380 $452 576 29.50 The company\'s direct labor rate is $20 per hour, Required Using the company\'s activity-based costing system, compute the customer margin of Big Sky Outfitters. (Do not round intermediate calculations. Round your final answer to the nearest dollar.) ustomer margin

Solution

Particulars

Standard Model

Custom Design

Total

Sales

22400

7140

29540

(1600*14)

(2380*3)

Costs:

Direct Material Cost

6328

1728

8056

(452*14)

(576*3)

Direct Labour

8260

1980

10240

(29.50*14*20)

(33*3*20)

Supporting Direct Labour

6608

1584

8192

(29.50*14*16)

(33*3*16)

Order Processing

192

576

768

(192*1)

(192*3)

Custom Desinging Processing

0

762

762

(254*0)

(254*3)

Customer Service

432

Customer Margin (29540 - 8056 - 10240 - 8192 - 768 - 762 - 432)

1090

Particulars	Standard Model	Custom Design	Total
Sales	22400	7140	29540
(1600*14)	(2380*3)
Costs:
Direct Material Cost	6328	1728	8056
(452*14)	(576*3)
Direct Labour	8260	1980	10240
(29.50*14*20)	(33*3*20)
Supporting Direct Labour	6608	1584	8192
(29.50*14*16)	(33*3*16)
Order Processing	192	576	768
(192*1)	(192*3)
Custom Desinging Processing	0	762	762
(254*0)	(254*3)
Customer Service		432
Customer Margin (29540 - 8056 - 10240 - 8192 - 768 - 762 - 432)			1090