A company has four production departments. Fixed costs are as follows: Department £ Hours taken A 10,000 5 B 5,000 5 C 4,000 4 D 6,000 3 The company produces one product and the time spent in each department is shown above. If overhead is recovered on the basis of labour hours and budgeted production is 2,000 units, the fixed cost per unit is A £3 B £12 C £12.50 D £17.50

FINANCIAL ACCOUNTING
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Chapter1: Financial Statements And Business Decisions
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A company has four production departments. Fixed costs are as follows:

Department £ Hours taken

A 10,000 5

B 5,000 5

C 4,000 4

D 6,000 3

The company produces one product and the time spent in each department is shown

above. If overhead is recovered on the basis of labour hours and budgeted production

is 2,000 units, the fixed cost per unit is

A £3

B £12

C £12.50

D £17.50

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