(Marks 5)
- 1 KK Corporation uses the following activity rates from its activity-based costing to assign overhead costs to products. (1.5 Marks)
|
Activity Cost Pools |
Activity Rate |
|
Setting Up Batches |
SAR 83.75 Per Batch |
|
Assembling Products |
SAR 2.88 per assembly hours |
|
Processing Customer orders |
SAR 50.41 per Customer order |
Data concerning two products appear below:
|
Particulars |
Product A |
Product B |
|
Number of Batches |
34 |
41 |
|
Number of Assembly Hours |
105 |
824 |
|
Number of Customer orders |
17 |
38 |
Required:
a. How much overhead cost would be assigned to Product A using the company’s activity-based costing system? Show your work!
b. How much overhead cost would be assigned to Product B using the company’s activity-based costing system? Show your work!
Answer
Q.2 In August 2021, MAK Co. incurred total cost of SAR 29,000 and made 3,100 units. In November 2021, it produced 1,600 units and total costs were SAR 20,000. What are the total fixed cost and average variable cost? [1 marks]
Answer..
Q.3 Abrar Corporation manufactures umbrellas. The cloth used in one umbrella costs $ 15. The corporation rents a manufacturing factory for a monthly rent of $ 275. Prepare a table showing the Total Fixed Cost, Total Variable cost, Total Cost and Average Fixed Cost, Average Variable Cost, and Average Cost for three different levels of production. (No. of units at three different levels can be chosen by you).
(1.5 Marks)
Answer
Q.4 Identify three differences between job order costing and process costing?
(1 Marks)
Answer
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