Question

The following activities occur at Greenwich Corporation, a company that manufactures a variety of products.

1. Receive raw materials from suppliers.

2. Manage parts inventories.

3. Do rough milling work on products.

4. Interview and process new employees in the personnel department.

5. Design new products.

6. Perform periodic preventive maintenance on general-use equipment.

7. Use the general factory building.

8. Issue purchase orders for a job.

Required:

Classify each of the activities above as either a unit-level, batch-level, product-level, or organization-sustaining activity.

Answer 1

The following introductions are necessary to understand the classification :

Unit Level activites	Whenever a unit of product is produced, these activities occur
Batch level activities	Batches are bunch of units say a batch of 50 units. Units are cluttered as batch for mass processing of activities a machine or man can handle at time. In batch level activities, the amount of resources consumed depends on the number of batches rather than on number of units
Product-level activites	Products differentiate each other by features. These are activities that are performed irrespective of units produced or batches processed.
organization-sustaining activity	These activities are related to running of organization basically administrative expenses and marketing expenses and as such. These are not directly related to production whatsoever.

Receive raw materials from suppliers.	Batch level
Manage parts inventories.	Product level
Do rough milling work on products.	Unit level
Interview and process new employees in the personnel department.	organization-sustaining
Design new products.	Product level
Perform periodic preventive maintenance on general-use equipment	organization-sustaining
Use the general factory building.	organization-sustaining
Issue purchase orders for a job	Batch level