Accounting 9706 · AS & A Level · Traditional costing methods

Traditional costing methods — practice question

Use the information below. Budgeted overhead cost = $60000$ Actual overhead cost = $66000$ Budgeted direct labour hours = $30000$ Actual direct labour hours = $35000$ Overheads are absorbed using direct labour hours. Calculate the amount of over absorption or under absorption of overheads?

  • A$4000$ over
  • B$4000$ under
  • C$6000$ over
  • D$6000$ under

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