ACCTG322 Chapter Notes - Chapter 5: Modx, Deutsche Luft Hansa, Snow Removal
8 Apr 2014
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Document Summary
Preventive maintenance is per- formed on general-purpose production equipment. Reminder notices are sent to customers who are late in mak- ing payments. Purchase orders are issued for materials to be used in production: modifications are made to product designs. New employees are hired by the personnel office: machine settings are changed between batches of different products. Parts inventories are main- tained in the storeroom. (each product requires its own unique parts. ) Insurance costs are incurred on the company"s fa- cilities. Number of purchase orders; time spent preparing purchase orders. Number of modifications made; time spent making modifica- tions. Number of batch setups; time spent making setups. Number of products; number of parts; time spent maintaining inventories of parts. Not applicable; these costs probably should not be assigned to products or customers. Other entries in the table are determined in a similar manner. Problem 5-17: the first-stage allocation of costs to activity cost pools appears below:
