Question

DeHart Technology, an Idaho manufacturer of printed circuit boards, has always estimated the support cost of its circuit boards with a 100% “markup” over its material costs. An activity analysis suggests that support costs are driven primarily by the number of manual operations performed on each board, estimated at $6 per manual operation. Compute the estimated support costs of the following two typical circuit boards using the traditional markup and the activity analysis results:


Why are the cost estimatesdifferent?


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  • CreatedNovember 19, 2014
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