A+ Ltd.’s income statement is shown in the diagram. The company uses direct labour as the basis of overhead allocation (a traditional system). The overhead cost is 50% of labour cost. Which product is more profitable to sell under per unit analysis?

Question

Answer

Product B is more profitable as it earns a bigger profit than product A

Answer

Product A is more profitable as it earns a bigger profit than product B

Answer

Product A is more profitable as it has a higher profit per unit than product B

Answer

Product B is more profitable as it has a higher profit per unit than product A

Crowdly

A+ Ltd.’s income statement is shown in the diagram. The company uses direct labo...

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