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Coursework part 2

MerionethMerioneth Settling In NicelyRegistered Posts: 21
Ok so after completing the overhead analysis sheet I've apportioned the costs of the other departments and I've calculated the overhead absorption rates per department per batch for 20x3/x4.

It then asks me to calculate the under/over absorption in regards to one particular department on one month.

It gives me
the budgeted output for the month 750 batches of 20 shirts
No of batches processed 800
Spray Starch used 104 litres cost £93.60
Direct Labour cost 8815 for 1075 hours
Actual Overhead cost £2600

So I've done the following

actual overhead cost £2600- absorped overhead (direct labour hours 1075 x overhead absorption rate for the ironing and pressing department for the year

this gives me 1189 which if you take away from 2600 means we've over absorped by £1411.00 I think!

Unless I'm being really stupid.

This would then be credited I think in the profit and loss account?
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