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(Click the icon to view the activity-cost categories.) Read the requirements. Requirement 1. Classify each activity cost as output unit-level, batch-level, product- or service-sustaining, or
(Click the icon to view the activity-cost categories.) Read the requirements. Requirement 1. Classify each activity cost as output unit-level, batch-level, product- or service-sustaining, or facility-sustaining. Explain each answer. Output unit-level costs are related to the number of units tested; required for each unit tested. Batch-level costs are related to a group of units of the service. They are not related to the number of units tested. Service-sustaining costs are costs used to support individual services regardless of the number of units or batches tested. Facility-sustaining costs are costs that can not be traced to individual services but support the company as a whole. Calculate the cost per test-hour for HT. (Round the rate to the nearest cent.) HT cost per test-hour a. Direct-labor costs, $217,000. These costs can be directly traced to HT, $165,000, and ST,$52,000. Equipment-related costs (rent, maintenance, energy, and so on), $375,000. These costs are allocated to HT and ST on the basis of test-hours. Setup costs, $375,000. These costs are allocated to HT and ST on the basis of the number of setup-hours required. HT requires 10,000 setup-hours, and ST requires 5,000 setup-hours. d. Costs of designing tests, $248,000. These costs are allocated to HT and ST on the basis of the time required for designing the tests. HT requires 2,000 hours, and ST requires 2,000 hours
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