A company manufactures Product A and Product B and uses Activity-Based Costing. The following activity data relates to the current month: Activity…
CA Intermediate · Cost and Management Accounting · MTP · January 2026
A company manufactures Product A and Product B and uses Activity-Based Costing. The following activity data relates to the current month: Activity Cost (₹) Cost Driver Total Driver Units Product A Product B Machine Setup 60,000 Number of setups 120 setups 30 setups 90 setups Quality Inspection 40,000 Number of inspections 200 inspections 50 inspections 150 inspections What is the total overhead cost assigned to Product A under ABC?
Suggested Answer and Working Notes:
Correct Answer: Option (B)
₹ 25,000
Topics: Activity Based Costing, Overheads - Absorption Costing Method
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