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Former Member
Jun 10, 2009 at 10:09 AM

Product Costing

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Dear all,

Our client place is a process industry. Paint manufacturing. We have defined 2 activity types. One is labour and another is machine. Machine's capacity is 1500. They have given the price as Rs.115. The client wont use full capacity. so under absorption of cost will come. How to deal with this underabsorption. When we produce a 50 kg, this much capacity is not needed.

please suggest us.

Thanks & Regards,

A.Anandarajan