A-LevelAccountingTraditional costing methods9706/12 · Feb/Mar 2017 · Q231 Mark

A business absorbs overheads based on machine hours. During the last quarter it had the following budgeted and actual results. Actual overheads $118505; actual machine hours 6230; budgeted overheads $126725; budgeted machine hours 6850. By how much were overheads over or under absorbed?

Aover absorbed by $3250

Bover absorbed by $8220

Cunder absorbed by $3250

Dunder absorbed by $8220

✓ Correct answer

C: under absorbed by $3250

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Topic: Traditional costing methods, A-Level Accounting (syllabus 9706). Multiple choice, 1 mark.
Source: A-Level Accounting, Feb/Mar 2017 Paper 1 Variant 2, question 23.

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