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Exercise 5-11 (Algo) Second-Stage Allocation and Margin Calculations [LO5-4, LO5-5] Foam Products, Incorporated, 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 Activity Measure Number of direct labor-hours Batch processing Order processing Customer service Number of batches Number of orders Number of customers Activity Rate $12 per direct labor-hour $ 92 per batch $ 278 per order $ 2,632 per customer The company just completed a single order from Interstate Trucking for 2,700 custom seat cushions. The order was produced in two batches. Each seat cushion required 0.5 direct labor-hours. The selling price was $141.20 per unit, the direct materials cost was $110 per unit, and the direct labor cost was $14.20 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 Sales Costs: Supporting direct labor Batch processing Order processing Customer service overhead Prev 6 of 6 Next Check my work

Exercise 5-11 (Algo) Second-Stage Allocation and Margin Calculations [LO5-4, LO5-5] Foam Products, Incorporated, 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 Activity Measure Number of direct labor-hours Batch processing Order processing Customer service Number of batches Number of orders Number of customers Activity Rate $12 per direct labor-hour $ 92 per batch $ 278 per order $ 2,632 per customer The company just completed a single order from Interstate Trucking for 2,700 custom seat cushions. The order was produced in two batches. Each seat cushion required 0.5 direct labor-hours. The selling price was $141.20 per unit, the direct materials cost was $110 per unit, and the direct labor cost was $14.20 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 Sales Costs: Supporting direct labor Batch processing Order processing Customer service overhead Prev 6 of 6 Next Check my work

Managerial Accounting: The Cornerstone of Business Decision-Making
Managerial Accounting: The Cornerstone of Business Decision-Making
7th Edition
ISBN:9781337115773
Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Chapter4: Job-order Costing And Overhead Application
Section: Chapter Questions
Problem 34BEB: Use the following information for Brief Exercises 4-34 and 4-35: Sanjay Company manufactures a...
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Exercise 5-11 (Algo) Second-Stage Allocation and Margin Calculations [LO5-4, LO5-5] Foam Products, Incorporated, 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 Activity Measure Number of direct labor-hours Batch processing Order processing Customer service Number of batches Number of orders Number of customers Activity Rate $12 per direct labor-hour $ 92 per batch $ 278 per order $ 2,632 per customer The company just completed a single order from Interstate Trucking for 2,700 custom seat cushions. The order was produced in two batches. Each seat cushion required 0.5 direct labor-hours. The selling price was $141.20 per unit, the direct materials cost was $110 per unit, and the direct labor cost was $14.20 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 Sales Costs: Supporting direct labor Batch processing Order processing Customer service overhead Prev 6 of 6 Next Check my work
Transcribed Image Text:Exercise 5-11 (Algo) Second-Stage Allocation and Margin Calculations [LO5-4, LO5-5] Foam Products, Incorporated, 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 Activity Measure Number of direct labor-hours Batch processing Order processing Customer service Number of batches Number of orders Number of customers Activity Rate $12 per direct labor-hour $ 92 per batch $ 278 per order $ 2,632 per customer The company just completed a single order from Interstate Trucking for 2,700 custom seat cushions. The order was produced in two batches. Each seat cushion required 0.5 direct labor-hours. The selling price was $141.20 per unit, the direct materials cost was $110 per unit, and the direct labor cost was $14.20 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 Sales Costs: Supporting direct labor Batch processing Order processing Customer service overhead Prev 6 of 6 Next Check my work
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