Charles has provided some of the costs he expects to incur as follows. Decide on the The cost object in each case is the cheesecake.

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Explain how increasing production can increase gross profit when using absorption costing.

Birdie Limited is a manufacturing company producing a variety of golf clubs. It operates from one factory that is geographically separated from its head office. The components for the clubs are assembled in the assembling department; they are then passed through to the finishing department where they are painted and packed. There are three service cost centres: administration, stores, and manufacturing support. The following costs were collected for the year to 31 May 2021: ETT Department Number of Allocated cost centre overhead costs (£,000) 225 employees 67 Assembling Finishing Administration 60 134 84 300 89 Stores 17 Manufacturing support 120 34 Additional information: The allocated cost centre overhead costs are all considered to be indirect costs as far as specific units are concerned. During the year to 31 May 2021, 208,000 machine hours were worked in the assembling department, and 270,000 direct labour hours in the finishing department. During the year to 31 May 2021, the…