Wilmington Inc. manufactures five models of kitchen appliances at its Mesa plant. The company is installing activity based costing and has identified the following activities performed at it Mesa plant.
1. Designing new models
2. Purchasing raw materials and parts
3. Storing and managing inventory
4. Receiving and inspecting raw materials and parts
5. Interviewing and hiring new personnel
6. Machine forming sheet steel into appliance parts
7. Manually assembling parts into appliances
8. Training all employees of the company
9. Insuring all tangible fixed assets
10. Supervising production
11. Maintaining and repairing machinery and equipment
12. Painting and packaging finished appliances
Having analyzed its Mesa pant operations for purposes of installing activity-based costing, Wilmington Inc. identified its activity cost centers. It now needs to identify relevant acidity cost drivers in order to assign overhead to Wilmington’s five products
Instructions:
Using the activities listed above, identify for each activity one or more cost drivers that might be used to assign overhead to Wilmington’s five products.