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Hello,
”Curtis runs a printing business. He estimates that his printing machine will need to be set up 200 times per month, at monthly total cost of $80,000. Item 2145 has to be printed in batches of 50 copies, where each batch requires the machine to be set up twice. Curtis expects the total demand for item 2145 to be 5000 copies per annum.
What amount should be charged to each copy of item 2145 for set up costs?
Can you tell me if I am right thinking that it is $ 16?
Kind regards,
KasiaThank you Mr. Moffat.
There is one more question I am not sure about.
”Meadaw Co operates an activity based costing system. The budgeted costs for warehousing for the next six months are $356,014, of which $215,414 is in respect of handling receipts of materials. The balance is for the issue of goods to production. In the same period it is expected that 3,700 orders will be received and 2,500 issues will be made. The company has received an order which will generate 14 receipts and 6 issues.
What is warehousing cost to be included in the total cost of the order?
Can you help me with this question please?
Kind regards
KasiaSurely you have answers to these questions in the same book in which you found the questions??
To get the cost per receipt you divide 215,414 by 3,700.
To get the cost per issue you divided the balance of the warehousing costs by 2,500.
Have you watched my free lectures on ABC?
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