Test your understanding 4
Cabal makes and sells two products, Plus and Doubleplus. The direct costs of production are $12 for one unit of Plus and $24 per unit of Doubleplus.
Information relating to annual production and sales is as follows:
PlusDoubleplus
Annual production and sales24,000 units24,000 units
Direct labour hours per unit1.01.5
Number of orders10140
Number of batches12240
Number of setups per batch13
Special parts per unit14
Information relating to production overhead costs is as follows:
Cost driverAnnual cost
Setup costsNumber of setups73,200
Special parts handlingNumber of special parts60,000
Other materials handlingNumber of batches63,000
Order handlingNumber of orders19,8000
Other overheads-216,000
