Steam Whistle Brewing is a successful brewery engaged in the development and production of specialty micro brews.
Question:
Steam Whistle Brewing is a successful brewery engaged in the development and production of specialty micro brews. It uses an activity-based costing system. During the past year, it has incurred $1,250,000 of product development costs; $850,000 of materials handling costs; $2,500,000 of production line labour costs; $700,000 for production setup costs; $500,000 in power costs for cooling beer and running equipment; and $1,500,000 for manufacturing facility management.
REQUIRED
In an ABC cost hierarchy, calculate the total cost that would be classifi ed as
A. Facility sustaining
B. Product sustaining
C. Batch level
D. Unit level
Step by Step Answer:
Cost Management Measuring, Monitoring and Motivating Performance
ISBN: 978-1119185697
3rd Canadian edition
Authors: Leslie G. Eldenburg, Susan K. Wolcott, Liang Hsuan Chen, Gail Cook