Page 236 - F2 - MA Integrated Workbook STUDENT 2018-19
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Chapter 10
Cost units
Service organisations may use several different cost units to measure the different
kinds of service that they are providing.
A composite cost unit is more appropriate if a service is a function of two variables.
The calculation of a cost per service unit is as follows:
Cost per service unit = Total costs for providing the service ÷ Number of service units
used to provide the service
Test your understanding 2
Records for a passenger limousine company reveal the following data for the
last period:
No of passengers Miles travelled
80 4
40 5
90 6
100 7
140 8
180 9
150 10
The drivers’ wages cost incurred was $1,100
The drivers’ wages cost per passenger mile was (to the nearest cent):
A $0.03
B $0.18
C $1.41
D $22.45
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