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PLB Bhd is a company producing bulk meat substitutes for the vegetarian food industry. It produces three meat types: Pork (P), Lamb (L) and
PLB Bhd is a company producing bulk meat substitutes for the vegetarian food industry. It produces three meat types: Pork (P), Lamb (L) and Beef (B). Direct costs per tonne are as follows: Materials Labour time B P RM500 L RM700 RM850 12 hours 14 hours 8 hours 1,000 750 900 Budget production (tonnes) Direct Labour cost is RM10 per hour. The company has just completed an activity based costing exercise. For the year just ended, the following activities, along with their associated costs were identified: Activity Machine set ups cost Ordering materials Storage Packing costs Cost (RM'000) 16,000 1,125 990 106 Total drivers associated with each of these activities have been identified, and are shown in the table below, along with the number of units of each driver used by of the three products: Production runs Inventory orders Tonne days of storage ('000) 9824 20 45 1538 L B 9 25 30 36 Packing costs are incurred on per tonne basis, and are the same per tonne for all three products. Required: Calculate the cost of the finished products using activity based costing.
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