Highlands Machining Company produces bicycle gears from high-quality stainless steel. Assume you are an assistant depart- ment manager helping to develop a new cost-allocation system. Because you under- stand the weaknesses of the traditional volume-based method, you have been asked to classify some of the company's costs using Cooper's hierarchy. You have been given a list of four types of costs: . . . Lighting costs for the production areas Raw materials movement costs: the wages and supplies consumed in moving raw materials from inventory storage to a production area (Materials are moved each time a different production order begins.) The costs of cooling the metal-cutting equipment (Metal-cutting equipment re- quires constant cooling during the production process. The cooling costs include the costs of liquid coolant, pumps and hoses, and the energy to power the cooling system.)

- Research and development expenses incurred to develop a new product Required Classify each cost as a unit-level, batch-level, product-level, or facility-level cost, and explain your classifications.