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Question Content Area Panamint Systems Corporation is estimating activity costs associated with producing disk drives,...

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Question

Accounting

Question Content Area
Panamint Systems Corporation is estimating activity costs associated with producing disk drives, tapes drives, and wire drives. The indirect labor can be traced to five separate activity pools. The budgeted activity cost and activity base data by product are as follows:
Line Item Description
Activity Cost
Activity Base
Procurement $370,000 Number of purchase orders
Scheduling 250,000 Number of production orders
Materials handling 500,000 Number of moves
Product development 730,000 Number of engineering changes
Production 1,500,000 Machine hours
Line Item Description
Number of
Purchase
Orders
Number of
Production
Orders
Number
of
Moves
Number of
Engineering
Changes
Machine
Hours
Number
of
Units
Disk drives 4,0003001,400102,0002,000
Tape drives 4,000150800108,0004,000
Wire drives 12,0008004,0002510,0002,500
The activity rate (rounded to the nearest cent) for the scheduling activity cost pool is
a. $200.00 per production order
b. $20.00 per production order
c. $29.41 per production order
d. $10.42 per production order

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