A company has computed an indirect allocation rate of 50% based on direct wages for a quality control department, and an 80% allocation rate (based also on direct wages) to cover indirect costs in the sales and administration department. Both indirect departments have 30% variable costs. Direct wages are NOK 10 000, and are considered variable.What is correct?

a)The absorption cost is 50%

b)The absoption cost of their product is 13000

c)The absorption cost is 3000

d)The absorbtion cost of their product, when direct wages per unit is NOK 10 000, is 23 000