Explanation:
The identification of the cost driver is presented below:
This identification is required so that the indirect cost can be allocated according to the each cost pool
Machine setup, indirect materials = Number of setups
Inspections = Number of inspections
Test = Number of test
Insurance, plant = Machine hours or square feet
Engineering design = Engineering Hours
Depreciation, machinery = Machine hours
Machine setup, indirect labor = Number of setups
Property taxes = Machine hours or square feet
Oil, heating = Machine hours or square feet
Electricity, plant lighting = Machine hours or square feet
Engineering prototypes = Engineering Hours
Depreciation, plant = Machine hours or square feet
Electricity, machinery = Machine hours
Machine maintenance wages = Number of machines or machine hours
