In question 2.1) I can't get to the value 6666. I did the calculations using the formula of COGM for full costing system based on pratical capacity and got total fixed cost of 7040.
In reply to Rafaela Simone Martins Barros
Re: Exam 23/24 Fall Q-2
Hello Rafaela,
You need to use the information given on the COGM based on VC
COGM/u (VC) for product A is 12.18€. COGM/u (TFC) is 27 660€ / 2 000 = 13.83€. The difference is due to MFC, which for Product A are therefore = (13.83 - 12.18) * 2 000 = 3 300€
COGM/u (VC) for B is 11.60€. COGM/u (TFC) = 14 817€ / 1 100 = 13.47€. The difference is due to MFC once again, which for Product B are = (13.47 - 11.60) * 1 800 = 3 366€
In product B, you multiply by 1 800 units because that was the production (1 100 + 700).
Total MFC = 3 300 + 3 366 = 6 666 €
Good study!
You need to use the information given on the COGM based on VC
COGM/u (VC) for product A is 12.18€. COGM/u (TFC) is 27 660€ / 2 000 = 13.83€. The difference is due to MFC, which for Product A are therefore = (13.83 - 12.18) * 2 000 = 3 300€
COGM/u (VC) for B is 11.60€. COGM/u (TFC) = 14 817€ / 1 100 = 13.47€. The difference is due to MFC once again, which for Product B are = (13.47 - 11.60) * 1 800 = 3 366€
In product B, you multiply by 1 800 units because that was the production (1 100 + 700).
Total MFC = 3 300 + 3 366 = 6 666 €
Good study!