Mock exam question - #2 — OpenTuition Forums

TTod10y ago

Budget fix overheads - $ 216 000 Budget labour hours - 144 000 Actual fixed overheads - $235 200 Over absorption fixed overheads - $16 800 How many labour hours were actually worked. 1) 216000/144000= 1.5 2) 235200/1.5= 156800 3) 16800/1.5= 11200 11200 + 156800 = 168000 hours ? Why we should add 11200 instead of subtract ? We over- absorbed, doesn't it mean that we need subtract this hours , because it over- absorbed hours ? Best regards , Tod

Former user10y ago#1

o.a.r x actual hours= absorbed hour 1.5 x (unknown)= 235200+16800=252000 actual overhead= 235200 therefore inorder to get your answer divide 252000/1.5=168000 hope this helps

TTod10y ago#2

Thanks a lot !

John MoffatTutor10y ago#3

You are welcome :-)

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