1. Give a cost drivers each activity:

* Purchasing raw materials

* Inspecting raw materials

* Storing raw materials

* Maintaining production equipment

* Setting up machines to produce product

* Testing finished products

2. Label each as facility-, product-, customer-, batch-, or unit- cost. Provide an allocation base for each.

a. Direct materials used by workers to assemble products

b. Purchase requisitions issued for raw materials

c. Machines set up to produce groups of products

d. New product research and development

e. Maintenance on the factory building

f. Direct labor assembling products

g. Product designed for a specific customer

h. Factory building rent