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Questions 6 to 7 are based on the following information: Panamint Systems Corporation is estimating activity-based costs associated with producing disk drives, tapes drives,
Questions 6 to 7 are based on the following information: Panamint Systems Corporation is estimating activity-based costs associated with producing disk drives, tapes drives, and wire drives. The indirect costs can be traced to five separate activities. The budgeted activity cost and activity base data by product are provided below. Activity Activity Base Cost Procurement $370,000 Number of purchase orders Scheduling 250,000 Number of production orders Materials handling 500,000 Number of moves Product development 730,000 Number of engineering changes Production 1,500,000 Machine hours Number Number of Number Number of Machine Number of Purchase of Production Engineering Changes Hours of Orders Moves Units Orders Disk drives 4,000 300 1,400 10 2,000 2,000 Tape drives 4,000 150 800 Wire drives 12,000 800 4,000 22 10 8,000 4,000 25 10,000 2,500 6. Determine the activity rate for materials handling per move. OA. $50.00 OB. $20.83 C. $80.65 D. $58.82
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