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Fisher Fixtures manufactures three types of lighting fixtures, with model names of Silver, Gold, and...

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Accounting

Fisher Fixtures manufactures three types of lighting fixtures, with model names of Silver, Gold, and Platinum. It applies all indirect costs according to an annual predetermined rate based on direct labor-hours. The plant controller has recommended that the company switch to an activity-based costing system. The controller's staff prepared the following cost estimates for next year (year 2) for the recommended cost drivers.
\table[[Activity,Recommended Cost Driver,Estimated Cost,Estimated Cost Driver Activit],[Purchasing material,Number of purchase orders,$126,000,240 purchase orders],[Receiving material,Direct materials cost,232,000,$2,900,000
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