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Nonyane (Pty) Ltd produces three special products, TTM, K9K and AAA. The company uses activity-based costing. For all the products, an order is placed
Nonyane (Pty) Ltd produces three special products, TTM, K9K and AAA. The company uses activity-based costing. For all the products, an order is placed and received after two equipment set-ups were done. The following budgeted information is available for the year ended 31 August 2021: Cost- and operational information: Total number of quality inspections Total number of equipment set-ups Total number of orders Production and sales (units) Direct material (cost per unit) Direct labour (cost per unit) Overhead costs: Quality inspection cost Equipment set-up cost Ordering costs TTM K9K AAA 20 45 35 30 40 50 ? ? ? 5 000 3.000 6.000 R50 R90 R65 R40 R25 R55 R 600 000 450 000 300 000 REQUIRED (a) Calculate the activity rates for safety inspections, quality inspections and ordering, respectively. Marks (4)
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