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OAR QUESTION

Forums › ACCA Forums › ACCA MA Management Accounting Forums › OAR QUESTION

  • This topic has 1 reply, 1 voice, and was last updated 1 year ago by abdulvarisvk234.
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  • July 31, 2023 at 12:22 pm #689186
    Anonymous
    Inactive
    • Topics: 1
    • Replies: 0
    • ☆

    the following information is available:
    Allocated $13122
    Apportioned $7920
    Reapportioned from service cost centres $2988
    216000 units of product are manufactured at a rate of 120 units per machine hour.

    Req: calculate the OAR per machine hour.

    Please advise on this.

    September 27, 2023 at 6:11 am #692559
    abdulvarisvk234
    Participant
    • Topics: 0
    • Replies: 2
    • ☆

    Total fixed production cost=13122+7920+2988=24030
    120 units takes 1 hour, so we are having 216000.
    so, it takes 1800 hours, cuz, 216000/120.
    so now u have got hours and total production overhead.
    24030/1800=13.35$/machine hour is the OAR per machine hour here.

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