Panamint Systems Corporation is estimating activity costs associated with producing disk drives, tapes drives, and wire drives.
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Question:
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 $338,400 Number of purchase orders Scheduling 226,700 Number of production orders Materials handling 415,000 Number of moves Product development 739,600 Number of engineering changes Production 1,538,600 Machine hours Number of Purchase Orders Number of Production Orders Number of Moves Number of Engineering Changes Machine Hours Number of Units Disk drives 4,050 280 1,450 10 2,000 1,500 Tape drives 1,500 245 640 7 8,000 3,900 Wire drives 12,400 720 4,500 24 10,000 2,500 The activity-based cost for each wire drive unit is a.$740.18 b.$18.85 c.$219.21 d.$368.59
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