Hadley Corp. makes hand-crafted wooden rocking horses. It has a sales department that runs on a budget of $100,000, a manual-labor shipping department with a personnel budget of $60,000, a packaging department that is fully automated with a budget of $25,000, and an assembly department where workers cut the parts and assemble them by hand that has a budget of $150,000. Identify the departments that contribute to product costs and the relevant cost drivers for each.

Box 1: Select the best answer