An accountancy firm had an overhead budget of $51,070 for a period. Actual overhead expenditure in the period was $52,400. Overheads are absorbed on the basis of client hours worked which totalled 2,375 in the period and resulted in under-absorption of $657 What was the budgeted overhead absorption rate per client hour? show solution
Master Budget
A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.
Sales Budget and Selling
A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.
An accountancy firm had an overhead budget of $51,070 for a period. Actual overhead
expenditure in the period was $52,400.
hours worked which totalled 2,375 in the period and resulted in under-absorption of $657
What was the budgeted overhead absorption rate per client hour? show solution
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