A company manufacturing two products furnishes the following data Annual output: Product Output units Machine Hours Purchase Orders Machine set-ups A 5000 20000 160 20 B 60000 120000 384 44 Total 65000 140000 544 64 The annual overheads are as under. Rs Volume related activity costs 550,000 Set up related costs 820,000 Purchase related costs 618,000 Total 1,988,000 You are required to calculate the overheads cost per unit of each product A and B based on Activity based costing method.

A company manufacturing two products furnishes the following data Annual output: Product Output units Machine Hours Purchase Orders Machine set-ups A 5000 20000 160 20 B 60000 120000 384 44 Total 65000 140000 544 64 The annual overheads are as under. Rs Volume related activity costs 550,000 Set up related costs 820,000 Purchase related costs 618,000 Total 1,988,000 You are required to calculate the overheads cost per unit of each product A and B based on Activity based costing method.

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter5: Process Costing

Section: Chapter Questions

Problem 2PB: The following product costs are available for Kellee Company on the production of eyeglass frames:...

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