Budgeting Practice Assessment 4

Claire1705

Can anyone help with the answer to Q1.4 B of budgeting practice assessment 4 on the AAT website please?

Its the part that asks you to work out the variable production overhead and in the question it says that 'variable overhead relates to labour hours, including overtime'. For the year the figure is £33,600 and for April, in the answers it says it is £2,940 but I have no idea how to get to this figure.

I have my exam booked in for a few weeks time so any help much appreciated!

Jo Clark

Hello Claire

You take the £33,600 for the year and divide that by the budgeted units produced for the year 144,000 then multiply by the units produced in April 12,600 = £2,940

Does this help?


JC