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PGT Ltd uses a standard costing system and applies overhead on the basis of direct labour hours. The direct labour standard indicates that two direct

PGT Ltd uses a standard costing system and applies overhead on the basis of direct labour hours. The direct labour standard indicates that two direct labour hours should be used for every unit produced. The normal production volume is 200,000 units. The budgeted overhead for the coming year is as follows: Variable Overhead (at normal level) $ 888,000 Fixed Overhead $1,540,000 Actual results: Manufactured 194,000 units. Worked 392,000 direct labour hours. Incurred actual fixed overhead costs of $1,560,000. Incurred actual variable overhead costs of $862,400

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