amherst metal works

ABC systems commonly use a cost hierarchy with four levels to identify cost-allocation bases that are cost drivers of the activity cost pools: (1) Output unit-level costs: the costs of activity performed on each individual unit of a product or service. (2) Batch-level costs: the costs of activities related to a group of units of a product or service. (3) Product-sustaining costs (service-sustaining costs): the costs of activities undertaken to support individual products or services, regardless of the number of units or batches in which the units are produced or services provided. (4) Facility-sustaining costs: the costs of activities that support the organization as a whole. Exercise 5-18: SharpPitch, Inc. manufactures karaoke machines for several well-known companies. The machines differ significantly in their complexity and their manufacturing batch sizes. Classify the following costs were incurred during the year as output unit-level, batch-level, product sustaining, or facility-sustaining: a. Indirect manufacturing labor costs such as supervision that supports direct manufacturing labor, $950,000 b. Procurement costs of placing purchase orders, receiving materials, and paying suppliers related to the number of purchase orders placed, $675,000 c. Cost of indirect materials, $180,000 d. Costs incurred to set up machines each time a different product needs to be manufactured, $450,000 e. Designing processes, drawing process charts, and making engineering process changes for products, $315,000 f. Machine-related overhead costs such as depreciation, maintenance, and production engineering. $975,500 (These resources relate to the activity of running the machines.) 8. Plant management, plant rent, and plant insurance, $578,000 Illustration: Plastim manufactures two types of lenses for Giovanni: a simple lens called S3 and a complex lens called CS. Under the control