Ace Manufacturing identifies the following activities and
drivers for its operations:
Activity | Activity Driver | Driver Quantity |
Moving Materials | Number of moves | 200 |
Machining | Machine hours | 10,000 |
Ace estimates Moving Materials and Machining will cost $1,400,000
and $3,000,000 respectively. Ace's activity rates are:
a.$70 per move and $3 per machine hour.
b.$7 per move and $30 per machine hour.
c.$700 per move and $3,000 per machine hour.
d.$7,000 per move and $300 per machine hour.
Activity | Activity Driver | Driver Quantity | Activity Cost | Activity Rate |
Moving Materials | Number of moves | 200 | 1,400,000 | 1,400,000/200 = $7000 per move |
Machining | Machine hours | 10,000 | 3,000,000 | 3,000,000/10,000 = $300 per machine hour |
Correct option is d.
.$7,000 per move and $300 per machine hour.
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Ace Manufacturing identifies the following activities and drivers for its operations: Activity Activity Driver Driver Quantity...
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