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Part D (2.5 marks) The selling price of a tonne of Sugar is $600. At this price, the FSC plans to sell 5000 tonnes in
Part D (2.5 marks) The selling price of a tonne of Sugar is $600. At this price, the FSC plans to sell 5000 tonnes in week. The FSC board wants to have a mark-up of 20% on cost. The expected production cost is $520 per tonne of sugar. Calculate the target cost gap. SECTION B RESEARCH QUESTION (10 marks) Activity Based Costing (ABC) is said to be more accurate than the traditional costing methods because the Activity-Based Costing (ABS) method identifies the activities in the company and assigns their costs to production based on actual consumption. However, ABC has its own problems as well. Based on the model above and your knowledge on ABC, research on: ---Atleast4benefitsofABCtoanorganization.Listandexplainat-least3limitationsoftheABCmodel.Listandexplainat-least3problemsassociatedwithABCmodel.(4marks)(3marks)(3marks)
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