Exhibit 17-2 BigView Monitors manufactures three different sizes of computer monitors: 15-inch, 17-inch, and 20-inch. The company has recently implemented an activity-based costing system. BigView has identified five different production activities as well as the best cost driver for each activity. Each activity and driver is listed below, along with the budgeted amount that is associated with each activity for next year.
The following information relates to each size of monitor and next year's anticipated manufacturing operations:

-Refer to Exhibit 17-2. What is BigView's cost per cost driver for parts handling for next year (rounded)?

Question

Exhibit 17-2 BigView Monitors manufactures three different sizes of computer monitors: 15-inch, 17-inch, and 20-inch. The company has recently implemented an activity-based costing system. BigView has identified five different production activities as well as the best cost driver for each activity. Each activity and driver is listed below, along with the budgeted amount that is associated with each activity for next year.
 The following information relates to each size of monitor and next year's anticipated manufacturing operations:
 
-Refer to Exhibit 17-2. What is BigView's cost per cost driver for parts handling for next year (rounded)?

Quizplus · Accepted Answer

The total cost for parts handling is $53,000 and the total number of parts is 100,000. Therefore, the cost per cost driver for parts handling is $53,000 / 100,000 parts = $0.53 per part.

Exhibit 17-2 BigView Monitors Manufactures Three Different Sizes of Computer