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Assume that firm makes four products A, B, C and D. Data for the past period are as follows: Direct

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Assume that firm makes four products A, B, C and D. Data for the past period are as follows: 

Direct labour costs Rs. 7 per hour: 

Find the unit production cost.

(a). Using conventional product costing using a labour hour or machine hour overhead absorption rate. 

(b). Using ABC with the following cost drivers:

(c). Compare the results from the two methods.

Transcribed Image Text:

Product A B C D Output units 25 25 250 250 No. of production runs in period 3 347 4 7 10 24 Direct labour hrs per unit 2424 Machine hours per unit 2 2424 Material cost per unit (Rs.) 30 75 30 75 Material components per unit ∞ in ∞ 6 8 5 8

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a Using Conventional Product Costing with Labor Hour Overhead Absorption Rate Calculate the labor hours required for each product Product A 8 hours per unit Product B 5 hours per unit Product C 30 hou…View the full answer


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Related Book For  answer-question
Cost Accounting

Cost Accounting

ISBN: 9780070221628

4th Edition

Authors: Jawahar Lal, Seema Srivastava

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Question Details
Chapter # 8- A CTIVITY-BASED COSTING..
Section: Problem
Problem: 3
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Question Posted: September 05, 2023 01:59:26
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