Page 31 - BA2 Integrated Workbook - Student 2017
P. 31
Cost identification and classification
2.4 The total cost of a cost object
We can use these classifications to calculate the total (or full) cost of a cost object.
The following shows the calculation of the cost for one unit of product X
$
Direct material 20
Direct labour 10
Direct expenses 15
–––
PRIME COST 45
Indirect material 10
Indirect labour 2
Indirect expenses 11
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TOTAL PRODUCTION OVERHEAD 23
–––
TOTAL PRODUCTION COST 68
Non-production cost 22
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TOTAL COST 90
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TYU 2/TYU 3
23
