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Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA MA – FIA FMA › factory heat
Hi sir! I want to ask how is the cost of factory heat a fixed production overhead and not a variable production overhead? because, I assume that the cost of factory heat will vary with the level of production because the more we produce, the more the machinery is getting used and therefore it will lead to more factory heat.
And also, in reference to 2nd video lecture of chapter 8, why did we not split the cost of factory heat on the basis of NBV equipment? why did we split it on the basis of cubic space?
You have asked these questions also as comment on lectures and I have answer them there 🙂