CFOS/Overheads/Exercise 4.2 Sample Answers

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Apportioning the costs of inspection using the ABC method requires the following calculations:

Total Cost of Inspection for a batch of Product X =
 * Inspection Hours × Cost per Hour

Unit Cost of Inspection for Product X =
 * Total Inspection Cost for Product X
 * divided by the Number of Units of Product X in batch

Compare these figures with the Answers to Exercise 4.1.