Essen COSTS de ance to travel to en beds depends 5) or high main- the five activity EXERCISE 7-5…
Essen COSTS de ance to travel to en beds depends 5) or high main- the five activity EXERCISE 7-5 Product and Customer Profitability Analysis LO7.4, L07-5 Thermal Rising, Inc., makes paragliders for sale through specialty sporting goods stores. The com- pany 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: sure tenance beds Antenance beds Activity Cost Pool Supporting direct labor Order processing Custom design processing Customer service Activity Rate $25 per direct labor hour $284 per order $186 per custom design $379 per customer summarized its Management would like an analysis of the profitability of a particular customer. Big Sky Outfit- ker, which has ordered the following products over the last 12 months Standard Model Custom Design ty 20 1 o 26.35 $1,850 $564 Number of gliders Number of orders Number of custom designs Direct labor hours per glider Selling price per glider Direct materials cost per glider The company's direct labor rate is $19.50 per hour 3 3 3 28.00 $2.400 $634 intenance beds intenance beds Chapter 7 Required: Using the company's activity-based costing system, compute the customer margin of Big Sky Outfit May 16 2022 03:09 PM
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