Question: ABC Inc. is estimating activity costs associated with producing disk drives, tapes drives, and wire drives. The indirect labor can be traced to five activity

ABC Inc. is estimating activity costs associated with producing disk drives, tapes drives, and wire drives. The indirect labor can be traced to five activity pools. The budgeted activity cost and activity base data by product are provided below. Activity Activity Base Cost Number of purchase orders Procurement $ 370,000 Number of production orders Scheduling 250,000 Number of moves Materials handling 500,000 Number of engineering changes Product development 730,000 Machine hours Production 1,500,000 Number Number of of Purchase Production Orders Orders Number Number of Machine Number of Engineering Hours of Moves Changes Units 4,000 Disk drives 300 1,400 2,000 2,000 4,000 150 800 Tape drives 10 10 25 8,000 4,000 Wire drives 12,000 800 4,000 10,000 2,500 Total 20,000 1,250 6.200 45 20,000 8,500 The rate for the scheduling activity cost pool is $200.00 per production order $20.00 per production order $29.41 per production order $10.42 ppp production order
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