FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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Panamint Systems Corporation is estimating activity costs associated with producing disk drives, tapes drives, and wire drives. The indirect labor can be traced to four separate activity pools. The budgeted activity cost and activity base data by product are provided below.

 
Activity Cost
 
Activity Base
Procurement $338,600   Number of purchase orders
Scheduling 202,800   Number of production orders
Materials handling 446,200   Number of moves
Product development 762,000   Number of engineering changes
Production 1,472,600   Machine hours
 
Number of
Purchase
Orders

Number of
Production
Orders

Number
of
Moves

Number of
Engineering
Changes


Machine
Hours

Number
of
Units
Disk drives 3,910    370       1,220  15         2,100  2,400 
Tape drives 1,800    215       580  3         9,700  4,400 
Wire drives 12,100    900       3,800  23         10,400  2,400 

The activity rate for the materials handling cost pool is

a.$19.01 per move
b.$66.33 per move
c.$136.57 per move
d.$79.68 per move
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