Question: The allocated fixed cost per unit is the same for both Standard and Custom products ($40 per unit). This implies that the fixed costs are

The allocated fixed cost per unit is the same for both Standard and Custom products ($40 per unit). This implies that the fixed costs are being allocated based on the assumption that each product consumes an equal share of the fixed costs. However, this may not be a valid assumption in practice, especially if the products use different amounts of resources or have different production processes.

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