Knowledge check 01 denny corporation sales $ 9,000 direct costs: direct materials $ 1,800 direct labor $ 1,350 activity cost pools total cost machine-setups $ 20,000 special processing 150,000 general factory 200,000 total overhead costs $ 370,000 overhead cost for denny corporation activity cost pool (a) activity rate (b) activity (a) × (b) abc cost machine-setups $ 100 setups 20 setups $ 2,000 special processing $ 15 per machine-hour 50 mhs 750 general factory $ 10 per direct labor-hour 400 direct labor-hours 4,000 total overhead cost assigned to customer $ 6,750 what is the customer margin for denny corporation? what conclusion can you draw from this information? $(900), further analysis is required. $5,850, this is a highly profitable customer. $1,850, this is a marginally profitable customer. $(3,900), the customer should be dropped immediately.