Concept introduction:
Unit-level activities:
The activities that are carried out at the time of the production of each unit are considered as unit-level activities. The unit-level cost should be proportional to the number of units produced.
Batch-level activities:
The activities that are carried out at the processing of a batch are considered as batch-level activities. These activities are carried out on the batch −level regardless of the number of units in a batch.
Product-level activities:
The activities that are carried out for a specific product are considered as a product-level activity. Product-level activities do not consider the batch quantity and number of units.
Organization-sustaining activities:
The activities that are carried out for running the organization, regardless of the customer influence and number of the batch unit, are considered as organization-sustaining activities.
Provide an example of the activity measure for the given activities.
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Chapter 5 Solutions
MANAGERIAL ACCOUNTING
- true answer ? general accountingarrow_forwardGiven the following information how much raw material was transferred to work in progress on January 31? Inventory on January 1 is $350,000, raw materials purchased in January are $860,000, and raw materials inventory on January 31 isarrow_forwardGross profit margin?arrow_forward
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- Horngren's Cost Accounting: A Managerial Emphasis...AccountingISBN:9780134475585Author:Srikant M. Datar, Madhav V. RajanPublisher:PEARSONIntermediate AccountingAccountingISBN:9781259722660Author:J. David Spiceland, Mark W. Nelson, Wayne M ThomasPublisher:McGraw-Hill EducationFinancial and Managerial AccountingAccountingISBN:9781259726705Author:John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting PrinciplesPublisher:McGraw-Hill Education
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