FInancial performance management
I'm working on a finance question and need an explanation and answer to help me learn.
Question 2 c (10%)
A company has total annual activity costs in the activity group procurement of kr 2 400 000, of which
80.0% are fixed and 20.0% are considered being variable.
The budgeted activity level reflects the handling of 640 purchase orders per year, but this is only 70%
of the available capacity.
What is the annual cost of the excess capacity?
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