A-LevelAccountingTraditional costing methods9706/12 · Feb/Mar 2023 · Q261 Mark
A manufacturing business makes a single type of product. It has two production departments, machining and assembly. A maintenance department provides services to the production departments. Budgeted figures for these departments are shown. overheads machining $800 000 assembly $400 000 maintenance $300 000 production units 200 000 50 000 The business uses a cost per unit rate to absorb overheads. Maintenance department overheads are transferred to production departments in proportion to output. Which figures are correct for the machining department?
Aoverheads $950 000 cost per unit $4.75
Boverheads $1000 000 cost per unit $5.00
Coverheads $1040 000 cost per unit $4.16
Doverheads $1040 000 cost per unit $5.20
✓ Correct answer
D: overheads $1040 000 cost per unit $5.20
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