Abc activity area cost-driver rates product cross-subsidization

Answer to ABC, activity area cost-driver rates, product cross-subsidization. Idaho Potatoes (IP) operates at capacity and processes potatoes into potato. ABC, activity area cost-driver rates, product cross-subsidization Idaho Potatoes (IP) operates at capacity and processes potatoes into potato cuts at its highly automated Pocatello plant. It sells potatoes to the retail consumer market and to the institutional market, which includes hospitals, cafeterias, and university dormitories. IP’s simple costing system has a single direct . ABC, activity area cost-driver rates, product cross-subsidization Idaho Potatoes (IP) operates at capacity and processes potatoes into potato cuts at its highly automated Pocatello plant. It sells potatoes to the retail consumer market and to the institutional market, which includes hospitals, cafeterias, and university dormitories/5(3).

(50 min.) ABC, activity area cost-driver rates, product cross-subsidization. Intex Potatoes (IP) operates at capacity and processes potatoes into potato cuts at its highly automated Pocatello plant. It sells potatoes to the retail consumer market and to the institutional market, which includes hospitals, cafeterias, and university dormitories. (50 min.) ABC, activity area cost-driver rates, product cross-subsidization. 1. Direct costs Direct materials $ , Indirect costs. Product support , Total costs $1,, Cost per pound of potato cuts == $ 2. Cost Costs in Number of Costs per. Pool Pool Driver Units Driver Unit. Direct materials used ₹ , Production support ₹ , ABC, activity area cost-driver rates, product cross-subsidization. Lays Potatoe market and to the institutional market, which includes hospitals, cafeterias, raw potatoes) and a single indirect-cost pool (production support).

Product cross-subsidization- if a company undercosts one of its products, it will overcost at activity cost pools to products by means of cost drivers. ABC traces costs to products ac- on a driver-engineering changes-that is chosen to reflect the consumption 01 cross-subsidy by using volume-. ACTIVITY-BASED COSTING (ABC). In the past, the vast majority of departments used direct labour hours as the only cost driver for applying costs to products.