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Identify the incorrect answer: A proper overhead absorption rate could be: 1. 2. 3. 4. £6.67 per person-hour 185% of the wage bill £1000 per unit 800% on materials costs Identify the correct answer: To the nearest pound, the cost of the unit made in February, using an OAR based on person-hours, is: 1. £400 2. £422 3. £500 4. £822

Identify the incorrect answer: A proper overhead absorption rate could be: 1. 2. 3. 4. £6.67 per person-hour 185% of the wage bill £1000 per unit 800% on materials costs Identify the correct answer: To the nearest pound, the cost of the unit made in February, using an OAR based on person-hours, is: 1. £400 2. £422 3. £500 4. £822

Practical Management Science
Practical Management Science
6th Edition
ISBN:9781337406659
Author:WINSTON, Wayne L.
Publisher:WINSTON, Wayne L.
Chapter2: Introduction To Spreadsheet Modeling
Section: Chapter Questions
Problem 20P: Julie James is opening a lemonade stand. She believes the fixed cost per week of running the stand...
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Only need to do second question thanks. For the second question, wouldn't the £150 class as labour hours? I don't understand why you multiply it the 30 by £6.67 when it already states the labour hours thanks
n P3 OAR Example Questions The following data applies to a cost centre in the month of January 2010 Total overhead = £10000, Labour Hours = 1500, Total direct wages = £5400, Total material cost = £1200, Total machine hours = 200, Total units produced = 10 In February 2010 Job #54 was completed using: 8 machine hours, materials costing £72, and 30 person-hours costing £150. A single unit was produced and the selling price for the unit was £800. Use this data to answer the two questions: Identify the incorrect answer: A proper overhead absorption rate could be: 1. 2. 3. 4. £6.67 per person-hour 185% of the wage bill £1000 per unit 800% on materials costs ly Identify the correct answer: To the nearest pound, the cost of the unit made in February, using an OAR based on person-hours, is: 1. £400 2. £422 3. £500 4. £822 Notes Comments 19 20 QO
Transcribed Image Text:n P3 OAR Example Questions The following data applies to a cost centre in the month of January 2010 Total overhead = £10000, Labour Hours = 1500, Total direct wages = £5400, Total material cost = £1200, Total machine hours = 200, Total units produced = 10 In February 2010 Job #54 was completed using: 8 machine hours, materials costing £72, and 30 person-hours costing £150. A single unit was produced and the selling price for the unit was £800. Use this data to answer the two questions: Identify the incorrect answer: A proper overhead absorption rate could be: 1. 2. 3. 4. £6.67 per person-hour 185% of the wage bill £1000 per unit 800% on materials costs ly Identify the correct answer: To the nearest pound, the cost of the unit made in February, using an OAR based on person-hours, is: 1. £400 2. £422 3. £500 4. £822 Notes Comments 19 20 QO
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why do we mulitply 6.67 by 30 when labour hours have already been accounted for with the £150? Thanks

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