United Technologies Corporation is using activity-based Costing in two of its subsidiaries: Otis Elevator Company and Carrier Corporation. The following table shows 27 activities and eight accounts identified at Carrier, along with the classification determined by the ABC project team.

Name of Activity or Account                                                                                     Classification by Activity level

Acquiring material ………………………………………………..............................................…             Batch

Inspecting incoming materials ………………………….......................................…………..             Batch

Moving materials …………………………………...............................................…………………           Batch

Planning production …………………………………………............................................………           Batch

Processing special orders ………………………………….........................................………….          Batch

Processing supplier invoices ……………………………….......................................…………           Batch

Receiving material ………………………………………………….................................................         Batch

Scheduling production ……………………………...........................................………………….          Batch

Inspecting production processes ……………………………....................................………..          Batch

Processing purchase orders …………………………………......................................………..          Batch

Building occupancy …………………………………….............................................…………….          Facility

Depreciation …………………………………………...............................................……………….          Facility

General management ……………………………………………..........................................……         Facility

Maintaining facilities ……………………………………............................................……………         Facility

Managing the environment …………………………….......................................………………        Facility

Assuring quality ………………………………………….......................................….………….        Sustaining

Expediting …………………………………………………............................................………….        Sustaining

Maintaining tools and dies …………………………………..................................…………         Sustaining

Maintaining/improving production processes ………………......................………..          Sustaining

Managing human resources ……………………………………................................……..          Sustaining

Managing waste disposal …………………………………………...................................…..         Sustaining

Processing payroll ………………………………………………….......................................….         Sustaining

Processing production information …………………………………..............................…        Sustaining

Providing product cost ……………………………………………......................................…..        Sustaining

Setting manufacturing methods ……………………………................................…………         Sustaining

Supervising production ………………………………………………........................................       Sustaining

Sustaining accounting ………………………………….........................................……………        Sustaining

Maintaining production equipment ……………………….............................…………            Sustaining

Direct Labor allowances …………………………………...............................................…………            Unit

Direct labor fringes …………………………………….....................................................…………            Unit

Utilities (equipment) ……………………………………….................................................………..            Unit

Overtime (hourly) …………………………………………..................................................………..            Unit

Rework …………………………………………………............................................…………..                        Unit

Shill differential ………………………………………………...................................................…….            Unit

Spoilage ………………………………………………...........................................…………….                        Unit

Required: 

Choose two activities or accounts from each of the four classification and explain why you agree or disagree with the ABC project team’s classification.