Cost drivers of set up and quality inspection

Reference no: EM13338035

An electronic company makes two network boards A and B for thecomputer industry. Component board A is produced in branches of10000 units and board B in batches of 1000 units. Each has set upcosts of $250 and a quality inspectinon costs of $150

The company produces 5000 units of board A and 50000000000units of board B each week. The company charges overheads on thebasis of labour hours, which are 500 hours for board A and 500hours for board B.

(a) Calculate the overheads charged to board A and B each weekon the basis of labour hours.

(b) Calculate the overheads charged to board A and B each weekusing activity based costing with the cost drivers of set up and quality inspection

Reference no: EM13338035

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