Dayton Extruded Plastics Is a Manufacturer of Injection-Molded Extrusions

Dayton Extruded Plastics is a manufacturer of injection-molded extrusions. Scrapped or defective extrusions were ground into powder and fed back into the extruders as raw materials. Defective extrusions were inspected out during line work and in handling returns from customers; they were then ground up in special grinding machines and mixed with new raw material and reused in manually controlled injection-molding machines. The molding machines use utilities provided for the main manufacturing facility. After grinding, maintenance and cleanup of the facilities were performed
by general maintenance personnel. Because all scrapped extruders were reused in this way, company management felt that the cost of scrap was "free."
The company's traditional cost accounting system did not associate any cost with the cost of processing scrap
Required:
(a) Identify the activities in bold as unit-level, batch-level, product-level, customer-level or facility-level.
(b) Explain why the company's traditional cost accounting system is giving misleading results related to Dayton Extruded Plastics processing of scrap