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2 marksActivity-Based Costing (ABC)

CAPE Accounting Unit 2 · 2015 · Paper 2 · Question 2(b)(ii)

Daley Ltd considers activity-based costing (ABC) using provided activity cost pools, cost drivers, and total capacities.

State TWO benefits of activity-based costing.

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Other parts of this question

  1. 2(a)Calculate the total cost of EACH job assuming overhead is applied at the rate of $12.50 per machine hour.[10 marks]
  2. 2(b)(i)Calculate the activity rate for EACH activity.[7 marks]
  3. 2(c)Copy the list and identify the units of cost that should be applied for each item on the job cost card for services delivered.[8 marks]
  4. 2(d)Explain the difficulties with costing a hairdo/haircut because of these four features.[8 marks]

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