absorption task i think!!!
valentino46
Registered Posts: 124 Dedicated contributor 🦉
JOB XYZ123:
ive been set a task that includes the following:
direct mat 55.5 units@ 286 per unit
direct wages department A-60 hours @13 p/h
department B-80 @ 12p/h
variable overheads:
department A - £24000 for 36000 direct labour hours
department B - £40000 for 50000 direct labour hours
fixed overheads:
total budgeted direct labour hours for whole fctory 90000
total budgeted expenditure £67500
Im unsure what to do with the labour hours part and what to include in calculating the cost of the job.
any pointers would be a great help
cheers guys
ive been set a task that includes the following:
direct mat 55.5 units@ 286 per unit
direct wages department A-60 hours @13 p/h
department B-80 @ 12p/h
variable overheads:
department A - £24000 for 36000 direct labour hours
department B - £40000 for 50000 direct labour hours
fixed overheads:
total budgeted direct labour hours for whole fctory 90000
total budgeted expenditure £67500
Im unsure what to do with the labour hours part and what to include in calculating the cost of the job.
any pointers would be a great help
cheers guys
0
Comments
-
Find the overhead absorption rates, then multiply them by the labour hours needed for the product.
- variable overheads:
department A - £24000 for 36000 direct labour hours so divide the £24,000 by the 36,000 DLHs - department B - £40000 for 50000 direct labour hours (equivalent calc)
- fixed overheads:
total budgeted direct labour hours for whole fctory 90000 total budgeted expenditure (same sort of thing)£67500
Now multiply- department A-60 hours x OAR
- department B-80 x OAR
- whole fctory (60+80) hrs x OAR
Is that enough to help without taking away the satisfaction you get from working out the answer?Sandy
sandy@sandyhood.com
www.sandyhood.com0 - variable overheads:
-
cheers sandy, thats great, i emailed tutor today with overhead absorption calcs that i had a bash at last night and have worked out the dep a and dep b but didnt do the total budget figures correctly.
Im finding ECR a lot more intense than FRA and more enjoyable as the calcs seem to be more intense.. have you done a blog on OAR?
rob0
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