a, b, c, d

b, c, a, d

b, a, c, d

c, a, b, d

cost of raw materials purchased

number of new patents filed

direct labor hours

number of set ups

number of employees

number of materials purchased

number of machine hours

number of service calls

It uses separate predetermined overhead allocation rates for each activity

It is not as accurate or precise as traditional costing system

It accumulates overheadcosts by processing departments

It is not as complex or as costly as traditional systems

estimating the total quantity of the cost driver

allocating indirect costs to the cost object

estimating the total indirect costs of each activit

identifying the activities

Many traditional costing systems can distort product costs and profitability.

Traditional costing systems tend to be more costly than activity-based costing system

Activity-based costing systems tend to combine various costs into a single cost pool

Activity-based costing systems tend to use fewer cost pools than does a traditional costing system.

indirect manufacturing costs

direct materials

sales commissions

direct labor

It increases the need for suppliers to deliver raw materials on time

It increases the risk of the inventory becoming obsolete or unsalable

It results in increased inventory storage costs.

It records summary journalentries before the units are purchased

It involves ordering raw materials in large quantities to obtain volume discounts

It triggers production after thecustomer places an order

It contracts with suppliers to deliver large quantities of goods once a year.

Its successful implementation is independent of vendor relationships

the floor space available for production increases

a company's inventory insurance costs increase

the risk of the inventory becoming obsolete increases

a company's storage costs increas

government pressure

budgeted profit

consumer demand

increased purchases

It results in a decrease in production space

It increases the inventory cos

) The users of this system sometimes lose sales because of little or no inventory buffers

The risk of the inventory becoming obsolete is very high.

production is completed in self-contained work cells

management works with suppliers to ensure defect-free raw materials

raw materials are ordered in large quantities

suppliers make frequent deliveries of small quantities of raw materials

job costing

process costing

batch costing

backflush costing

Raw and In-Process Inventory account

Raw Materials Inventory account

Work-in-Process Inventory account

Process account