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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:
Activity Cost Pool Activity Rate:
Supporting direct labor $ per direct laborhour
Order processing $ per order
Custom design processing $ per custom design
Customer 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:
Standard Model Custom Design
Number of gliders
Number of orders
Number of custom designs
Direct laborhours per glider
Selling price per glider $ $
Direct materials cost per glider $ $
The companys direct labor rate $ per hour.
Required:
Using the companys 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 a minus sign.
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