United Technologies Corporation implemented activity-based costing in two of its subsidiaries: Otis Elevator Company and Carrier Corporation. The following table shows 27 activities and eight accounts identified at Carrier, along with the classification determined by the ABC project team.¹¹

Required: 

Choose two activities or accounts from each of the four classifications and explain why you agree or disagree with the ABC project team’s classification.

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Name of Activity or Account Acquiring material Inspecting incoming materials. Moving materials ....... Planning production Processing special orders Processing supplier invoices Receiving material ....... Scheduling production Inspecting production processes Processing purchase orders Building occupancy Depreciation General management Maintaining facilities Managing the environment. Assuring quality........….. Expediting....... Maintaining tools and dies. Maintaining/improving production processes Managing human resources Managing waste disposal Processing payroll Processing production information Classification by Activity Leve Batch Batch Batch. Batch Batch Batch Batch Batch Batch Batch Facility Facility Facility Facility Facility Product Sustaining Product Sustaining Product Sustaining Product Sustaining Product Sustaining Product Sustaining Product Sustaining Product Sustaining