Question: Confused on how to get answer for number two and would like to understand how to reach the answer in order to be able to
Confused on how to get answer for number two and would like to understand how to reach the answer in order to be able to become proficient in the process.
Foam Products, Inc., makes foam seat cushions for the automotive and aerospace industries. The company's activity-based costing system has four activity cost pools, which are listed below along with their activity measures and activity rates: Activity Cost Pool Supporting direct labor Batch processing Order processing Customer service Activity Measure Number of direct labor-hours Number of batches Number of orders Number of customers Activity Rate $ 12 per direct labor-hour $ 97 per batch $ 286 per order $ 2,627 per customer The company just completed a single order from Interstate Trucking for 2,500 custom seat cushions. The order was produced in two batches. Each seat cushion required 0.4 direct labor-hours. The selling price was $141.70 per unit, the direct materials cost was $104 per unit, and the direct labor cost was $14.10 per unit. This was Interstate Trucking's only order during the year. Required: Calculate the customer margin on sales to Interstate Trucking for the year. Interstate Trucking Customer Margin-ABC Analysis Costs
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