Business, 06.12.2019 01:31 Kimmi4807

College supply company (csc) makes three types of drinking glasses: short, medium, and tall. it presently applies overhead using a predetermined rate based on direct labor-hours. a group of company employees recommended that csc switch to activity-based costing and identified the following activities, cost drivers, estimated costs, and estimated cost driver units for year 5 for each activity center.

activity recommended
cost driver estimated
cost estimated cost
driver units
setting up production number of production runs $ 36,000 100 runs
processing orders number of orders 60,000 200 orders
handling materials pounds of materials 24,000 8,000 pounds
using machines machine-hours 72,000 10,000 hours
providing quality management number of inspections 60,000 40 inspections
packing and shipping units shipped 48,000 20,000 units
$ 300,000
in addition, management estimated 2,000 direct labor-hours for year 5.
assume that the following cost driver volumes occurred in february year 5:

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College supply company (csc) makes three types of drinking glasses: short, medium, and tall. it pre...

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