155) The Marionettes Company is noted for an exceptionally impressive line of Mardi Gras
masks. Marionettes has established the following selling and distribution support
activity-cost pools and their corresponding activity drivers for the year 2010:
Activity Cost Cost Driver
Marketing $30 000 $500 000 of sales
Customer service 10 000 5000 customer
Order execution 5000 100 orders
Warehousing 5000 50 product lines
Required:
a. Determine the activity-cost-driver rate for each of the four selling and distribution
activities.
b. Under what circumstances is it appropriate to use each of the activity-cost drivers?
c. Describe at least one possible negative behavioural consequence for each of the four
activity-cost drivers.
156) For each of the following activities identify an appropriate activity-cost driver.
a. machine maintenance
b. machine setup
c. quality control
d. material ordering
e. production scheduling
f. warehouse expense
g. engineering design
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