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Question 1 ( a ) The following data have been collected for four cost types of Ade Ltd; A , B , C and D
Question a
The following data have been collected for four cost types of Ade Ltd; A B C and D at two activity levels for product Alpha.
tableCost type,Cost at units,Cost at unitsABCD
The cost behaviour patterns of each one of the above costs assuming linearity can either be classified as Variable, SemiVariable or Fixed in relation to the number of units produced.
Required:
i Classify each one of the costs A B C D above in terms of their behaviour patterns Variable SemiVariable, or Fixed in relation to number of units produced.
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ii What does the total variable cost per unit amount to for producing and selling one unit of Alpha?
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iii Calculate the production cost for Ade Ltd if it produces units of Alpha.
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