Figure 11-2
Owens Ltd Activity Drivers for Each Activity Have Been Identified and Their

question 16

Multiple Choice

Figure 11-2
Owens Ltd. produces specially machined parts. The parts are produced in batches in one continuous manufacturing process. Each part is custom produced and requires special engineering design activity (based on customer specifications) . Once the design is completed, the equipment can be set up for batch production. Once the batch is completed, a sample is taken and inspected to see if the parts are within the tolerances allowed. Thus, the manufacturing process has four activities: engineering, setups, machining, and inspecting. In addition, there is a sustaining process with two activities: providing utilities (plantwide) and providing space. Costs have been assigned to each activity using direct tracing and resource drivers: $\begin{array}{ll}\text { Engineering } & £ 1,000,000 \\\text { Setups } & 900,000 \\\text { Machining } & 2,000,000 \\\text { Inspection } & 800,000 \\\text { Providing space } & 250,000 \\\text { Providing utilities } & 180,000\end{array}$ Activity drivers for each activity have been identified and their practical capacities listed: $\begin{array}{ll}\text { Machine hours } & 25,000 \\\text { Setups } & 200 \\\text { Engineering hours } & 5,000 \\\text { Inspection hours } & 2,500\end{array}$ The costs of facility-level activities are assigned using machine hours.
-Refer to Figure 11-2. What is(are) the unit-level activity(ies) ?

• A)engineering
• B)setups
• C)inspecting
• D)machining

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Definitions:

Performance Appraisal

A periodic review and evaluation of an employee's performance, usually conducted to determine wage increases, promotions, and development needs.

Effective Branding

The process of creating a distinctive and durable perception in the minds of consumers, differentiating a product or service from its competitors.

Tangible Aspects

The physical or material characteristics of something, easily perceived by the senses.

Employer Branding

The process of promoting a company as the employer of choice to a desired target group, one which a company needs and wants to recruit and retain.