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SELECT THE BEST ANSWERS (Shows references and computations are required) (15 points) 1) ABC assumes all costs are because over the long run management can adjust the amount of resources employed, A) Fixed B) Variable C) Committed D) Nondiscretionary Answer the following questions using the information below. Mayan Potters manufactures two sizes of ceramic paperweights, regular and jumbo, The following information applies to their expectations for the planning period Cost Pool Overhead Costs Activity-cost driver Materials handling $ 45,000 90,000 orders Machine maintenance $300,000 15,000 maintenance hours Setups $270,000 45,000 setups Inspections S105.000 21,000 inspections Total support costs $220.000 Production Estimates Production unit: Regular 8,000,000 units Jumbo - 16,000,000 units Machine-bours - 200,000 mh Labor-hours 400.000 dih Mayan Potters uses an ABC system and assigns overhead costs based on the overhead activity information provided above 2) The activity-cost driver for the materials handling activity is A) Orders B) Maintenance hours C) Production units D) Setup 3) The materials handling activity-cost driver rate is A) S.50 B) $2.00 C) 55.00 D) 520.00 4) The inspections activity-cost driver rate is A)S SO B) $2.00 C) 55.00 D) $20.00

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