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Kitchen Appliances Ltd is considering adopting ABC costing and has identified the following five activity cost pools if it makes the switch: 1. Purchasing 2.
Kitchen Appliances Ltd is considering adopting ABC costing and has identified the following five activity cost pools if it makes the switch:
1. Purchasing
2. Handling materials
3. Machine setups
4. Assembly
5. Utilities
Required: i. Identify a suitable cost driver for each of the five activity cost pools.
ii. What would make the company switch to an ABC system?
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