Accounting 9706 · AS & A Level · Traditional costing methods

Traditional costing methods — practice question

A business gave the following figures. Budgeted overheads: $20000 Budgeted direct labour hours: 2000 Direct labour rate: $20 per hour The job used materials worth $45 and 6 hours of direct labour. Overheads are absorbed on the basis of direct labour hours worked. What was the total cost of the job before any profit was added?

  • A$165
  • B$175
  • C$180
  • D$225

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