Mathematics · Activity Based Costing
Fenella Co makes and sells products online using Activity-Based Costing (ABC). Its two most successful products are Charlie and Tango, alongside 15 other products. The company processes and despatches 20 million orders in total each year. Information relating to Charlie and Tango is as follows: • Charlie: Sales volume = 5 million units; Average order size = 2.5 units. • Tango: Sales volume = 6 million units; Average order size = 2 units. The total annual packing and despatching cost pool is $10 million. What is the packing and despatching cost per unit of Charlie?
- 1$0.16✓
- 2$0.20
- 3$0.40
- 4$1.00
Correct answer
$0.16
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