X Company uses activity-based costing for its product Supreme and Exel. The total estimated annual overhead cost for set up was RO 650,000 and the expected activity was 2500 set ups for the period. If product Exel requires 1500 set ups, the amount of overheads allocated to product Exel for set up cost would be: a. RO 380,000 b. RO 360,000 c. RO 390,000 d. RO 280,000
X Company uses activity-based costing for its product Supreme and Exel. The total estimated annual overhead cost for set up was RO 650,000 and the expected activity was 2500 set ups for the period. If product Exel requires 1500 set ups, the amount of overheads allocated to product Exel for set up cost would be: a. RO 380,000 b. RO 360,000 c. RO 390,000 d. RO 280,000
Chapter6: Activity-based, Variable, And Absorption Costing
Section: Chapter Questions
Problem 5PA: Medical Tape makes two products: Generic and Label. It estimates it will produce 423,694 units of...
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Variance Analysis
In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance.
Standard Costing
The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.
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X Company uses activity-based costing for its product Supreme and Exel. The total estimated annual overhead cost for set up was RO 650,000 and the expected activity was 2500 set ups for the period. If product Exel requires 1500 set ups, the amount of overheads allocated to product Exel for set up cost would be:
a.
RO 380,000
b.
RO 360,000
c.
RO 390,000
d.
RO 280,000
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