Free BA2 Exam Braindumps (page: 15)

CORRECT TEXT

Refer to the Exhibit.



PJ Ltd has forecast that the relationship between total overheads and machine hours will be as follows:

If the budget is to be based on 4,000 machine hours, the variable overhead absorption rate will be:

*per machine hour.

Give your answer to 2 decimal places.

Which of the following industries would not use process costing?

FL uses an absorption costing system. The overhead absorption rate for production overheads is $8.60 per direct labour hour.

Budgeted production overhead costs for the year were $473,000 and actual costs incurred were $468,000. 56,000 labour hours were used.

Which ONE of the following statements is correct?

A company operates an absorption costing system. Overheads are absorbed using a pre- determined absorption rate using labour hours.

Actual labour hours were 10% below budget for the period and overheads incurred were 10% above budget for the period. This would result in: