Thermal Rising, Incorporated, 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: Activity Cost Pool Supporting direct labor Order processing Custom design processing Customer service Activity Rate $20 per direct labor-hour $ 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: Number of gliders Number of orders Number of custom designs Direct labor-hours per glider Selling price per glider Standard Model Custom Design 11 3 2 3 0 3 29.50 32.00 $ 1,850 $ 452 $ 2,470 $ 574 Direct materials cost per glider 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. Note: Round your intermediate calculations and final answer to the nearest whole dollar amount. Loss amounts should be entered with a minus sign. Customer margin _ Check my work

Thermal Rising, Incorporated, 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: Activity Cost Pool Supporting direct labor Order processing Custom design processing Customer service Activity Rate $20 per direct labor-hour $ 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: Number of gliders Number of orders Number of custom designs Direct labor-hours per glider Selling price per glider Standard Model Custom Design 11 3 2 3 0 3 29.50 32.00 $ 1,850 $ 452 $ 2,470 $ 574 Direct materials cost per glider 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. Note: Round your intermediate calculations and final answer to the nearest whole dollar amount. Loss amounts should be entered with a minus sign. Customer margin _ Check my work

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter4: Activity-based Costing

Section: Chapter Questions

Problem 8CE: Electan Company produces two types of printers. The company uses ABC, and all activity drivers are...

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Activity-based costing: selling and administrative expenses Jungle Junior Company manufactures and sells outdoor play equipment. Jungle Junior uses activity-based costing to determine the cost of the sales order processing and the customer return activity. The sales order processing activity has an activity rate of 20 per sales order, and the customer return activity has an activity rate of 100 per return. Jungle Junior sold 2,500 swing sets, which consisted of 750 orders and 80 returns. Determine (A) the total and (B) the per-unit sales order processing and customer return activity cost for swing sets.
Bumblebee Mobiles manufactures a line of cell phones. The management has identified the following overhead costs and related cost drivers for the coming year. The following were incurred in manufacturing two of their cell phones, Bubble and Burst, during the first quarter. REQUIREMENT Review the worksheet called ABC that follows these requirements. You have been asked to determine the cost of each product using an activity-based cost system. Note that the problem information is already entered into the Data Section of the ABC worksheet.
Thermal Rising, Incorporated, 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: Activity Cost Pool Supporting direct labor Order processing Custom design processing Customer service Activity Rate $ 18 per direct labor-hour $ 192 per order $266 per custom design $ 428 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: 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 $16 per hour. Customer margin Standard Model 16 1 0 26.50 $1,900 $ 458 Custom Design 2 2 34.00 $ 2,480 $ 568 Required: Using the company's…
Thermal Rising, Incorporated, 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 on activity-based costing system with the following activity cost pools and activity rates: ActIvity Cost Pool Supporting direct lebor Order processing Custon desion processing Customer service Activity Rate $416 per direct labor-hour $ 182 per order $ 261 per custon design $426 per custoner 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 Stenderd Model Custos Desion 2 2 Number of gilders Number of orders Number of custon des igns Direct iabor-hours per gtider Selling price per glider Direct naterlals cost per ollder 14 30.50 $1,875 $ 444 33.00 $2.450 $ 500 The company's direct labor rate is $22 per hour Required: Using the company's activity-based costing…
Thermal Rising, Incorporated, makes paragliders for sale through specialty sporting goods stores. The company has a standard paraglider model, but also makes custom-designed paragliders. Management designed an activity-based costing system with the following activity cost pools and activity rates: Activity Cost Pool Supporting direct labor Order processing Custom design processing Customer service Activity Rate $ 18 per direct labor-hour $ 192 per order $ 269 per custom design $ 422 per customer Management wants to calculate the profitability of a particular customer, Big Sky Outfitters, which ordered the following products over the last 12 months: Number of gliders Number of orders Number of custom designs Standard Custom Model Design 13 2 1 2 0 2 33.00 Direct labor-hours per glider Selling price per glider Direct materials cost per glider The company's direct labor rate is $18 per hour. Required: 30.50 $ 1,875 $ 444 $ 2,400 $ 576 Using the company's activity-based costing system,…
Munabhai
Thermal Rising, Incorporated, 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: Activity Cost Pool Supporting direct labor Order processing Custom design processing Customer service Activity Rate $20 per direct labor-hour $184 per order $ 254 per custom design $430 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: Number of gliders Number of orders Number of custom designs i Direct labor-hours per glider Selling price per glider Direct materials cost per glider The company's direct labor rate is $20 per hour. Customer margin Standard Model 15 1 0 28.50 $ 1,925 $ 476 Custom Design 3 3 3 33.00 $ 2,460 $ 570 Required: Using the company's…
Thermal Rising, Incorporated, 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: Activity Cost Pool Supporting direct labor Order processing Custom design processing Customer service Activity Rate $ 26 per direct labor-hour $ 284 per order $ 186 per custom design $ 379 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 Model Design Number of gliders Number of orders 20 1 3 Number of custom designs Direct labor-hours per glider selling price per glider Direct materials cost per glider 26.35 28.00 $ 1,850 $ 564 $ 2,400 $ 634 The company's direct labor rate is $19.50 per hour. Requlred: Using the company's activity-based costing…
Hansaben
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: Activity Cost Pool Supporting direct labor Order processing Custom design processing Activity Rate $ 26 per direct labor-hour $ 284 per order $ 186 per custom design $ 379 per customer Customer service 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 Model Design Number of gliders 20 3 Number of orders 1 3 Number of custom designs Direct labor-hours per glider Selling price per glider Direct materials cost per glider 3 26.35 28.00 $ 1,850 $ 2,400 $ 564 $ 634 The company's direct labor rate is $19.50 per hour. Required: Using the company's activity-based costing…
Thermal Rising, Incorporated, makes paragliders for sale through specialty sporting goods stores. The company has a standard paraglider model, but also makes custom-designed paragliders. Management designed an activity-based costing system with the following activity cost pools and activity rates: Activity Cost Pool Supporting direct labor Order processing Custom design processing Customer service Activity Rate $ 22 per direct labor-hour $ 182 per order $ 261 per custom design $ 422 per customer Management wants to calculate the profitability of a particular customer, Big Sky Outfitters, which ordered the following products over the last 12 months: Number of gliders Number of orders Number of custom designs Direct labor-hours per glider Selling price per glider Direct materials cost per glider Standard Model Custom Design 16 2 1 2 0 2 30.50 32.00 $ 1,900 $ 450 $ 2,420 $ 580 The company's direct labor rate is $16 per hour. Required: Using the company's activity-based costing system,…
hermal 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: Activity Cost Pool Activity Rate Supporting direct labor $22 per direct labor-hour Order processing $182 per order Custom design processing $254 per custom design Customer service $428 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: StandardModel CustomDesign Number of gliders 10 3 Number of orders 1 3 Number of custom designs 0 3 Direct labor-hours per glider 27.50 34.00 Selling price per glider $1,650 $2,310 Direct materials cost per glider $ 458 The company’s direct labor rate is $18 per hour. Required:…