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    Comparison of activity based and conventional product costs : manufacturer

    fantastique fashions Ltd has switched from a conventional product costing system to an activity-based product costing system to assign manufacturing overhead costs to product. The table below shows the cost per unit for two products under the two costing systems :
    Costing System Product A Product B
    Conventional $36 $25
    ABC $30 $45
    Required:
    1) Describe the most likely features of product A and B replacing the question marks (?) in the following table with 'Yes' or 'No'.
    Product feature Product A Product B
    High-volume product line ? ?
    Low-volume product line ? ?
    Produced in small batches ? ?
    Produced in large batches ? ?
    Simple to produce ? ?
    complex to produce ? ?

    2.explain the answer to requirement 1.

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    Comparison of activity based and conventional product costs : manufacturer

    fantastique fashions Ltd has switched from a conventional product costing system to an activity-based product costing system to assign manufacturing overhead costs to product. The table below shows the cost per unit for two products under the two costing systems :
    Costing System Product A Product B
    Conventional $36 $25
    ABC $30 $45
    Required:
    1) Describe the most likely features of product A and B replacing the question marks (?) ...

    Solution Summary

    Comparison of activity based and conventional product costs are examined.

    $2.49

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