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Sagot :
Answer:
Storage Craft Inc.
__Adhesive___ can be classified as a class C item.
Explanation:
a) Data and Calculations:
Inventory:
Carbon Fiber Adhesive Copper Wood Total
Inventory content:
Percentage of the items 10% 50% 25% 15% 100%
Percentage of the dollar value 55% 7% 18% 20% 100%
b) With Activity-based Costing Method, a class C item is one that has the lowest consumption value. This class constitutes a relatively high proportion of the total number of items but has a relatively low proportion of the total dollar value. In this scenario, Adhesive has 50% of the inventory items but 7% of the dollar value. Thus, Adhesive is a class C item.
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