A company is making a study of the relative profitability of the two products A and B. In addition to direct costs, indirect selling and distribution costs to be allocated between the two products are...

A company is making a study of the relative profitability of the two products A and B. In addition to direct costs, indirect selling and distribution costs to be allocated between the two products are as under:

One unit of product A requires a storage space twice as much as product B. The cost to pack and forward one unit is the same for both the products. Sales men are paid salary plus commission @ 5 per cent on sales and equal amount of efforts are put forth on the sales of each of the products.