[dkrafiq92]

I have a question about Absorption costing. In the tutorial video, the lecturer said the profit increased from $72000 to $74000 due to the Fixed Production Overhead has an extra $2000.

– Here’s the video link: https://www.youtube.com/watch?time_continue=11&v=j1HvmZJf4Qg
– The time is around 14:18.

My questions:

1. why is there a budget for fixed production overhead of $20k?
2. why is the cost per unit for fixed production OH $2?
3. why the profit increased from $72000 to $74000?

Im sorry, but im really lost at sea 🙁 i’d greatly appreciate an enlightenment!

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