A-LevelAccountingTraditional costing methods9706/12 · May/June 2019 · Q221 Mark

A business has two production departments: assembly and machinery. The following budgeted information is available. | | assembly | machinery | |:---|:---|:---| | labour hours | 5600 | 1350 | | machine hours | 1200 | 6900 | | overheads | $75000 | $80 000 | What is the overhead absorption rate for the assembly department?

A$13.39 per labour hour

B$19.14 per machine hour

C$22.30 per labour hour

D$62.50 per machine hour

✓ Correct answer

A: $13.39 per labour hour

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Topic: Traditional costing methods, A-Level Accounting (syllabus 9706). Multiple choice, 1 mark.
Source: A-Level Accounting, May/June 2019 Paper 1 Variant 2, question 22.

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