Question

The Furniture Manufacturing sector makes furniture and related articles, such as mattresses, window blinds, cabinets, and fixtures. The processes used in the manufacture of furniture include the cutting, bending, molding, laminating, and assembly of such materials as wood, metal, glass, plastics, and rattan. However, the production process for furniture is not solely bending metal, cutting and shaping wood, or extruding and molding plastics. Design and fashion trends play an important part in the production of furniture. The integrated design of the article for both esthetic and functional qualities is also a major part of the process of manufacturing furniture. Design services may be performed by the furniture establishment's work force or may be purchased from industrial designers. Furniture may be made of any material, but the most common ones used in North America are metal and wood. Furniture manufacturing establishments may specialize in making articles primarily from one material. Some of the equipment required to make a wooden table, for example, is different from that used to make a metal one. However, furniture is usually made from several materials. A wooden table might have metal brackets, and a wooden chair a fabric or plastics seat. Furniture may be made on a stock or custom basis and may be shipped assembled or unassembled (i.e., knockdown). The manufacture of furniture parts and frames is included in this sector.
Source: MyPlan.com L.L.C. 2019, U.S. Census Bureau, 2018
REQUIRED:
a) Write steps involved in implementing Activity based costing in a typical furniture manufacturing operation as described above. Elaborate your answer while explaining key concepts like cost pools, cost drivers, pool rate etc. You may draw a diagram to illustrate you explanation.
b) In which kind of manufacturing operations ABC is a mere headache and a redundant exercise.
 

Answer 1

Answer:

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