1. Suppose that Cooplan manufactures four products: W, X, Y and Z. Output and cost data for the period just ended are as follows.

		output units		number of production runs in the period		marginal cost per unit ($)		direct labour hours per units		Machine hours per unit
w		10		3		20		1		1
x		10		5		80		3		3
z		100		2		20		1		1
y		100		4		80		3		3
				14
Direct labour cost per hour is 10 $. Overhead costs are as follows:
set-up costs				12500
short-run variable costs				4080
production and scheduling costs				9800
material handing costs				7500
				33880

Required

Calculate product costs using the following approaches.

(a) Absorption costing

(b) ABC

Answer rating: 100% (QA)

Calculation of unit costs using conventional costing method Recovery rate of Overheads Total Overhea... View the full answer