Question

7 Homework 6 Saved Help Save &Exit Submit Check my work Exercise 7-11 Second-Stage Allocation and Margin Calculations [LO7-4, LO7-5) 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 Activity Rate Number of direct labor-hours Number of batches Number of orders Number of customers S 13 per direct labor-hour $ 90 per batch S 277 per order S 2,634 per customer The company just completed a single order from Interstate Trucking for 1,900 custom seat cushions. The order was produced in three batches. Each seat cushion required 0.5 direct labor-hours. The selling price was $141.30 per unit, the direct materials cost was $109 per unit, and the direct labor cost was $13.70 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. ces Interstate Margin-ABC Analysis Prex 4 of 5 Next> 7.13 2/244

Answer 1

Answer;-

FOAM PRODUCTS INC.
INTERSTATE TRUCKING
CUSTOMER MARGIN (ABC ANALYSIS)
PARTICULARS		AMOUNT
		$
Sales	1900 units*141.30 per unit	268470
Less:- Costs
Direct material	1900 units*109 per unit	207100
Direct labor	1900 units*13.70 per unit	26030
Supporting direct labor	(1900 units*0.5 DLHs per unit)*$13 per DLHs	12350
Batch processing	$90 per batch*3 batches	270
Order processing cost	$277 per order*1 order	277
Customer service cost	$2634 per customer*1 customer	2634
Customer margin		19809