From the following information, calculate the Total cost of Product A and B using the ABC analysis: Product A Product B Units 5,000 5,000 Number of…

CA Intermediate · Cost and Management Accounting · MTP · May 2024
From the following information, calculate the Total cost of Product A and B using the ABC analysis: Product A Product B Units 5,000 5,000 Number of purchase orders placed 100 220 Number of deliveries received 70 200 Ordering Cost 4,00,000 Delivery Cost 1,35,000
(A) A = 47,500; B = 1,27,500
(B) A = 2,67,500; B = 2,67,500
(C) A = 1,60,000; B = 3,75,000
(D) A = 1,47,500; B = 1,47,500

Suggested Answer and Working Notes:

Correct Answer: Option (C)

A = 1,60,000; B = 3,75,000

Topics: Activity Based Costing

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