Prepare conventional (full absorption) cost allocation for product
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
![Task 1A
Company X has budgeted the following for the coming month:
Production
Direct material
Product A
1500 Units
Product A
22 GBP/unit
Product B
4000 Units
Product B
7 GBP/unit
Direct labour
Machine hours
Product A
14 hrs/unit
Product A
8 hrs/unit
Product B
1 hrs/unit
Product B
2 hrs/unit
Rate
5 GBP/hour
Overheads
Total
120 000
Indirect labour costs
30 000 GBP
Depreciation of
machinery
22 000 GBP
Rent and rates
45 000 GBP
Heating, lighting and
power
Indirect materials
15 000 GBP
6 000 GBP
Other indirect costs
2 000 GBP
Prepare conventional (full absorption) cost allocation for product](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F9a527d0c-4851-4ab6-9414-6b696f50cb5c%2Fc6d009ee-9bfb-4622-97a4-e2bf898d4135%2Fvlcwkw_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Task 1A
Company X has budgeted the following for the coming month:
Production
Direct material
Product A
1500 Units
Product A
22 GBP/unit
Product B
4000 Units
Product B
7 GBP/unit
Direct labour
Machine hours
Product A
14 hrs/unit
Product A
8 hrs/unit
Product B
1 hrs/unit
Product B
2 hrs/unit
Rate
5 GBP/hour
Overheads
Total
120 000
Indirect labour costs
30 000 GBP
Depreciation of
machinery
22 000 GBP
Rent and rates
45 000 GBP
Heating, lighting and
power
Indirect materials
15 000 GBP
6 000 GBP
Other indirect costs
2 000 GBP
Prepare conventional (full absorption) cost allocation for product
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