mMCQ.

Navigation Menu

Step into mMCQ.

Launch mMCQ. diagnostic

Explore mMCQ.

MDCAT prepFree DiagnosticPricing & SubscribeSign in

Resources

Terms & Conditions

mMCQ.

© 2021 - 2025 mMCQ.All rights reserved.

WhatsApp
A Level Accounting (9706)•9706/12/M/J/23
Question 25 from 9706/12/M/J/23

Explanation

Overhead absorption variance calculation

Steps:

  • Calculate the predetermined overhead absorption rate (OAR) = budgeted overheads / budgeted labour hours = 360,000/12,400=360,000 / 12,400 = 360,000/12,400=29 per hour (approximately).
  • Calculate absorbed overheads = OAR × actual labour hours = 29×13,100=29 × 13,100 = 29×13,100=379,900.
  • Calculate total variance = absorbed overheads - actual overheads = 379,900−379,900 - 379,900−340,000 = 39,900overabsorbed(approximately39,900 overabsorbed (approximately 39,900overabsorbed(approximately40,000).
  • The provided choices do not match the calculated amount.

Not enough information to match the choices, as the standard formula yields approximately 40,000overabsorbed,not40,000 overabsorbed, not 40,000overabsorbed,not15,000 or $20,000.

Final answer: Not enough information.

Topic: Traditional costing methods

Practice more A Level Accounting (9706) questions on mMCQ.me