Old MathJax webview

Old MathJax webview

To fully optimize the cost, Co decided to use multiple cost drivers to apportion cost appropriately. It wants you to follow ABC Technique to compute optimum cost and analyse it by comparing it with traditional method of costing. Following are the details: (15 Points) VOLUME ACTIVITY COST POOL BUDGETED VOLUME COST DRIVER Material procurement 300,000 no. of orders 3000 Material Handling 100,000 no. of movements 350 Set-up cost 400,000 no. of set-ups 450 Maintenance Cost 6,00,000 maintenance hrs 9000 Quality Control 150,000 no. of inspections 700 Machinery Operation 700,000 no. of machine hrs 70000 Company has produced a batch of 10,000 components of Steel bars, its material cost was 400,000 and labour Cost was 300,000. The usage activities of the said batch are as follows: To fully optimize the cost, Co decided to use multiple cost drivers to apportion cost appropriately. It wants you to follow ABC Technique to compute optimum cost and analyse it by comparing it with traditional method of costing. Following are the details: (15 Points) VOLUME ACTIVITY COST POOL BUDGETED VOLUME COST DRIVER Material procurement 300,000 no. of orders 3000 Material Handling 100,000 no. of movements 350 Set-up cost 400,000 no. of set-ups 450 Maintenance Cost 6,00,000 maintenance hrs 9000 Quality Control 150,000 no. of inspections 700 Machinery Operation 700,000 no. of machine hrs 70000 Company has produced a batch of 10,000 components of Steel bars, its material cost was 400,000 and labour Cost was 300,000. The usage activities of the said batch are as follows