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Panamint Systems Corporation is estimating activity costs associated with producing disk drives, tapes drives, and wire drives. The indirect labor can be traced to four
Panamint Systems Corporation is estimating activity costs associated with producing disk drives, tapes drives, and wire drives. The indirect labor can be traced to four separate activity pools. The budgeted activity cost and activity base data by product are provided below. Activity Cost Activity Base Procurement $335,000 Number of purchase orders Scheduling $205,600 Number of production orders Materials handling $420,000 Number of moves Product development $783,100 Number of engineering changes Production $1,551,300 Machine hours Number of Number of Number Number of Number Purchase Production Engineering of Machine of Orders Orders Moves Changes Hours Units Disk drives 4,110 1,340 280 14 2,500 2,100 1,800 550 Tape drives 195 8 9,000 3,900 Wire drives 920 4,000 25 11,500 2,000 11,100 Determine the activity rate per production order for scheduling. a. $67.45 b. $19.69 Oc. $240.14 d. $147.38
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