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 $331,200 Number of purchase orders Scheduling 206,700 Number of production orders Materials handling 450,000 Number of moves Product development 799,500 Number of engineering changes Production 1,521,400 Machine hours Number of Number of Number Number of Number Purchase Production of Engineering Machine of Orders Orders Moves Changes Hours Units Disk drives 4,030 290 1,340 13 2,100 1,600 Tape drives 2,500 175 600 5 8,400 3,900 Wire drives 11,200 730 3,600 22 10,400 2,800 The activity rate for the materials handling cost pool is Oa. $81.23 per move Ob. $18.68 per move Oc. $72.79 per move Od. $172.97 per move
Process Costing
Process costing is a sort of operation costing which is employed to determine the value of a product at each process or stage of producing process, applicable where goods produced from a series of continuous operations or procedure.
Job Costing
Job costing is adhesive costs of each and every job involved in the production processes. It is an accounting measure. It is a method which determines the cost of specific jobs, which are performed according to the consumer’s specifications. Job costing is possible only in businesses where the production is done as per the customer’s requirement. For example, some customers order to manufacture furniture as per their needs.
ABC Costing
Cost Accounting is a form of managerial accounting that helps the company in assessing the total variable cost so as to compute the cost of production. Cost accounting is generally used by the management so as to ensure better decision-making. In comparison to financial accounting, cost accounting has to follow a set standard ad can be used flexibly by the management as per their needs. The types of Cost Accounting include – Lean Accounting, Standard Costing, Marginal Costing and Activity Based Costing.
![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
$331,200
Number of purchase orders
Scheduling
206,700
Number of production orders
Materials handling
450,000
Number of moves
Product development
799,500
Number of engineering changes
Production
1,521,400
Machine hours
Number of
Number of
Number
Number of
Number
Purchase
Production
of
Engineering
Machine
of
Orders
Orders
Moves
Changes
Hours
Units
Disk drives
4,030
290
1,340
13
2,100
1,600
Tape drives
2,500
175
600
8,400
3,900
Wire drives
11,200
730
3,600
22
10,400
2,800
The activity rate for the materials handling cost pool is
O a. $81.23 per move
Ob. $18.68 per move
Oc. $72.79 per move
Od. $172.97 per move](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F50c4a886-3e07-4312-95fc-3240a8ded880%2F9bb94d41-4f04-48eb-baa6-3680114f157f%2F0y2j0jp_processed.jpeg&w=3840&q=75)
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