QuestionFixlt, Inc. operates 20 injection molding machines in the production of tool boxes of four different sizes, named the Apprentice, the Handyman, the Journeyman, and the Professional.
Classify each of the following costs as unit-level, batch-level, product-level, or facility-level.
Activity Cost Level (a) First-shift supervisor's salary. $\square$ (b) Powdered raw plastic. $\square$ (c) Dies for casting plastic components. $\square$ (d) Depreciation on injection molding machines (assume units-of-activity depreciation). $\square$ (e) Changing dies on machines. $\square$ (f) Moving components to assembly department. $\square$ (g) Engineering design. $\square$ (h) Employee health and medical insurance coverage. $\square$

Studdy Solution
Classify each cost:
(a) First-shift supervisor's salary: This is a facility-level cost because it is related to the overall operation of the facility, not tied to specific units, batches, or products.
(b) Powdered raw plastic: This is a unit-level cost because it varies with the number of units produced.
(c) Dies for casting plastic components: This is a product-level cost because it is specific to the production of particular products.
(d) Depreciation on injection molding machines (assume units-of-activity depreciation): This is a unit-level cost because it varies with the number of units produced.
(e) Changing dies on machines: This is a batch-level cost because it is incurred each time a batch is produced.
(f) Moving components to assembly department: This is a batch-level cost because it is incurred for each batch moved.
(g) Engineering design: This is a product-level cost because it is specific to the design of particular products.
(h) Employee health and medical insurance coverage: This is a facility-level cost because it is related to the overall operation of the facility.
The classifications are as follows:
(a) First-shift supervisor's salary. $\text{Facility-level}$ (b) Powdered raw plastic. $\text{Unit-level}$ (c) Dies for casting plastic components. $\text{Product-level}$ (d) Depreciation on injection molding machines (assume units-of-activity depreciation). $\text{Unit-level}$ (e) Changing dies on machines. $\text{Batch-level}$ (f) Moving components to assembly department. $\text{Batch-level}$ (g) Engineering design. $\text{Product-level}$ (h) Employee health and medical insurance coverage. $\text{Facility-level}$