Financial performance level 4 aat

deep0075deep0075 Just JoinedPosts: 2Registered
can any one help me with this question:
Aye ltd used standard costing to manage its costs, and absorbs fixed overheads using direct labour hours as an absorption base. its makes one product and each unit takes five standard direct labour hours to manufacture.
standard direct cost for one unit are:
direct material 3 lts at £4 per ltrs= 12 per unit
direct labour 5 hrs at 10 p/h = 50 p/h
fixed Ohs 5 hrs at 50 p/h = 250 p/unit
The standrad fixed overhead for one month are £62500 . the standrad production output for one month is 1250 standard hours(ie 250 units of product).this gave a budgeted standard absorption rate 50 per standard direct labour hours as shown above.
during feb actual production was 1300 standard direct labour hours (ie 260 units of product)
Actual costs for feb were as follows:
direct material 800 lts costing total 3120
direct labour 1340 hours costing total of 14000, and fixed overheads actual cost £ 64800

can any one calculate BUDGETED COST FOR ACTUAL PRODUCTION? IN ANSWER THAT IS £81,120

Comments

  • omega manomega man Trusted Regular Posts: 283Registered
    direct material 260 units x £12 = 3,120,direct labour 260 x 50 = £13,000
    fixed overheads 260 x 250 = £65,000
    3120 + 13000 + 65000 = 81120
Sign In or Register to comment.