Businesses should ensure they price their goods and services reasonably to retain competitive advantage. An accurate method of costing is important as it can assist a business to determine a fair price for their final product. With the above in mind, the CEO of GoGo Airlines has provided you with the following information: Total Overheads = £200,000 Total Machine Hours = 100,000 You are required to calculate the unit costs of the vegan and non-vegan meals using: • Traditional costing using machine hours as the basis of allocation of costs and • ABC system • Traditional costing using machine hours as the basis of allocation of costs and • ABC system In addition, you are also required to: • Discuss the importance of accurate costing in supporting the financial decision process • Compare the traditional costing system to the ABC system and • Recommend, with reasons, which of the two costing systems is most appropriate for the airline sector

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