Suppose that you own a freight forwarder company. One of your customers ZMR A.. called you on January 2022 and asked for the freight offer for the transportation of five TEU (your cost object) products from location X to location Y. You are supposed to give a reasonable freight offer to your customer. Your profit margin is 20 %. First find the cost, then add 20 % profit margin to find the customer price. Use job costing and normal costing.

a) Select your allocation base and compute the allocation rate per unit. You may use multiple allocation bases.

b) Refer to your answer in question c. If you used activity-based costing in your company, what would change? What are the advantages and disadvantages of activitybased costing?