Thermal Rising, Incorporated, makes paragliders for sale through specialty sporting goods stores. The company has a standardparaglider model, but also makes custom-designed paragliders. Management has designed an activity-based costing system with thefollowing activity cost pools and activity rates:Activity Cost PoolSupporting direct laborOrder processingCustom design processingCustomer serviceActivity Rate$ 26 per direct labor-hour$ 284 per order$ 186 per custom design$ 379 per customerManagement would like an analysis of the profitability of a particular customer, Big Sky Outfitters, which has ordered the followingproducts over the last 12 months:standardCustomModelDesignNumber of glidersNumber of orders2013Number of custom designsDirect labor-hours per gliderselling price per gliderDirect materials cost per glider26.3528.00$ 1,850$ 564$ 2,400$ 634The company's direct labor rate is $19.50 per hour.Requlred:Using the company's activity-based costing system, compute the customer margin of Big Sky Outfitters. (Round your Intermedlatecalculations and final answer to the nearest whole dollar amount.)Customer margin

Solution: Computation of Total Overhead cost assigned to Customer Big Sky Activity Cost Pool…

Answered: Thermal Rising, Incorporated, makes…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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