Hello..In Bpp kit 7a.25
A company uses blanket overhead.....
The ans is Actual direct labour hour were 800 less than budgeted.
But in underabsorption case..Actual hour should be more right? I am so confused in it.
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Accounting for Production overhead.
4y ago#1There is no question 7a.25 in the current edition of the BPP Revision Kit :-(
However, we amount absorbed is always the actual hours multiplied by the standard overhead cost per hour.
If they actually work more hours than budgeted they will end up over-absorbing. If they actually work less hours than budgeted they will have under absorbed.
Have you watched my free lectures on this?
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