Elandem.PLC produces 20,000 units of Product L and 20,000 units of Product M. Under activity-based costing, 120,000
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Elandem.PLC produces 20,000 units of Product L and 20,000 units of Product M. Under activity-based costing, £120,000 of costs are purchasing related. If 240 purchase orders are produced each period, and the number of orders used by each product is:
• calculate the per-unit activity-based cost of purchasing for Products L and M;
• calculate the overhead recovery for purchasing costs if those costs were recovered over the number of units of the product produced.
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