Schif Company produces seven products. PQ-6 costs $240 00 per unit under ther tr

Question

Schif Company produces seven products. PQ-6 costs $240 00 per unit under ther tradito al cost system us ng one cost driver A? a alysis of the act costs revealed that three cost drivers would be used under the new ABC system The new cost of PQ-6 was determined to be $190.00 per unit ties and her Given this change in the cost O A. PQ-6 will now command a lower sales price. O B. Schiff's other products will be assigned a smaller share of overhead costs O C. PQ-6 will now command a higher sales price O D. PQ-6 costing results under the new system depend on the adequacy and quality of the estimated sales and sales revenue used by the system

Explanation / Answer

Price under the traditional costing system is more than the price under the ABC system

So as the price per unit under the ABC system has decrease so it cleary demands lower sales price

Correct answer is A

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