WRITERS' Company Writers' Company produces 2 products presently The information related to manufacturing is given below. WRITERS' Company Yr XXXXXXXXXX Fountain Pen Units 10000 Area occupied (sq feet)...

WRITERS' Company
Writers' Company produces 2 products presently The information related to manufacturing is given below.
WRITERS' Company Yr 2018-19
Fountain Pen
Units 10000
Area occupied (sq feet) 7000
Variable cost – Direct 32 Fixed Cost - Direct (per
unit) 10
Rent - Fixed Cost per month (Indirect - common for all products)
Ball point
20000 8000 25
8
3,00,000.00
The Fixed indirect cost of Rent of Rs 3,00,000/- is to be allocated to both the products The company was doing this on the "number of units" basis till now.
a. Please compute cost per unit of each product basis the above method.
You have researched and advised Writers' Company to have Activity Based Costing and have gathered data to support the allocation of the Fixed indirect cost as follows :
Break-up of Indirect Fixed Costs Allocation basis
Area of Rent 3,00,000 operations
b. Please compute cost per unit of each product on the new method of allocation
WRITERS' Company
Writers' Company produces 2 products presently
The information related to manufacturing is given below.
WRITERS' Company
Units
Area occupied (sq feet) Variable cost – Direct
Fixed Cost - Direct (per unit)
Rent - Fixed Cost per month (Indirect - common for all products)
Yr 2018-19
Fountain Pen
10000 7000 32 10
Ball point
20000 8000 25 8
3,00,000.00