Anna Bellatorre, Inc. is interested in using its activity-based costing system to improve its operating efficiency and its profit margins by applying activity-based management techniques. As part of this undertaking, you have been asked to classify its plant activities as value-added or non-value-added.
Instructions
Using the list of activities below, classify each activity as either value-added or non-value-added.
(a) Designing new models
(b) Purchasing raw materials and parts
(c) Storing and managing inventory
(d) Receiving and inspecting raw materials and parts
(e) Interviewing and hiring new personnel
(f) Machine forming sheet steel into appliance parts
(g) Manually assembling parts into appliances
(h) Training all employees of the company
(i) Insuring all tangible fixed assets
(j) Supervising production
(k) Maintaining and repairing machinery and equipment
(l) Painting and packaging finished appliances