Cummings Company has identified the following overhead activities costs and activity drivers for the coming year: The
Question:
Cummings Company has identified the following overhead activities costs and activity drivers for the coming year:
The company produces several different subassemblies used by other manufacturers. Information on separate batches for two of these subassemblies follows:
The company's normal activity is 20,000 direct labour hours. Each batch uses 100 hours of direct labour. Uponinvestigation, you discover that Receiving employs a worker, who spends 75% of her time on the receivingactivity and 25% of her time on inspecting products. Her salary is $80,000. Receiving also uses a forklift, at acost of $12,000 per year for depreciation and fuel. The forklift is used only in receiving.
Cost management a strategic approach
ISBN: 978-0073526942
5th edition
Authors: Edward J. Blocher, David E. Stout, Gary Cokins