ABC Worksheet

For each of the situations below, indicate whether the activity is a(n) unit-level activity, batch-level activity, product sustaining activity or facility-level activity. If you feel necessary, add a BRIEF explanation as to your rationale.

1. Maintenance of parts inventory for Malibu Barbie in a Mattel toy factory

2. Cost of an adjunct professors salary for a night class

3. The review of each tax return by a supervisor at H&R Block

4. Cost of oil filters at Jiffy Lube

5. Cost of safety training and equipment at a foundry producing specialty products

6. Costs associated with a special machine which sands the edges of each finished unit produced, including lampstands, outlet covers and switchplates

Classify each of the following costs as value-added or non-value added. Add a BRIEF explanation of your rationale, if you feel it necessary.

1. Cooking meals in a restaurant

2. Filing 941 and W-2 data with the Federal government

3. Storage of recreational vehicles in a parking lot prior to sale.

4. Rewriting faulty software code in a computer software company

Managerial Accounting - Seventh Edition

The Cornerstone of Business Decision Making