Please could you explain why the answer is d) and not c) to the following question:
Jc co operates a bottling plant. The liquid content of a filled bottle of product is 2 litres. During the filling process there is 30% loss of liquid input due to spillage and evaporation. The standard price of the liquid is $1.20 per litre. The standard cost of the liquid per bottle of product T, to the nearest cent, is
A. $2.49
B. $2.86
C. $3.11
D. $3.43
The solution talks about loss of input and not output but I don't understand the difference nor the calculation!
Thank you.
ACCA Forums
MAF2 - standard costing MCQ
11y ago#1The correct answer rounded to the nearest cent is $3.43.
Since the question says 30% loss. for example if we put in 100 we get only 70.
Therefore we put in 2000liters x 100/70 = $3.43.
I hope this is clear for you.
Thank you:)
Sign into reply to this topic.