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E6.29 LO6.9 Process costing: airport check-ins Friendly Skies Ltd operates the check-in facilities at domestic...

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E6.29 LO6.9 Process costing: airport check-ins Friendly Skies Ltd operates the check-in facilities at domestic and international terminals throughout Australia. During May the following costs were incurred as passengers were processed by the check-in department at Brisbane Airport: WESTERN SYDNEY UNIVERSITY International terminal Domestic terminal $18 000 $27 000 13 500 45 000 29 340 57 600 3 700 Costs: Managers' and supervisors' salaries Check-in staff salaries Depreciation on baggage handling equipment Boarding passes, baggage tags and other consumables Depreciation on computer hardware and software Equipment insurance Rent (allocated per square metre) Electricity Number of passengers processed 9 000 2 520 30 600 2 340 900 1 800 7 200 2 160 5 940 6 300 19 800 Required: 1. Calculate the cost per check-in at the international and domestic terminals. 2. Why does the cost per check-in differ between the two terminals? 3. Do these costs provide a reliable estimate of the costs incurred to check in each passenger at the international and domestic terminals? Explain your answer. 4. How might the management of Friendly Skies Ltd use this information

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