Three products have been costed using both a traditional labour based absorption costing system and an activity based costing system. The results for the unit costs are as follows:
Product
1
2
3
Traditional
£140
£120
£80
ABC
£90
£125
£130
Identify each product as products A, B or C:
Product A is produced in small batches and needs numerous quality inspections
Product B is produced in large batches and needs less inspection than the others
Product C is produced in large batches but needs multiple inspections
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