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QUESTION 5: The overhead costs in a factory, where a single product is manufactured comprise a variable element and stepped-fixed element . The variable cost
QUESTION 5:
The overhead costs in a factory, where a single product is manufactured comprise a variable element and stepped-fixed element. The variable cost element is $2.4 per direct labor hour. 0.9 direct labor hours are required per unit of the product. The fixed cost is $230,000 per period but is subject to an increase of $15,000 per period when output exceed 60,000 units.
In period 2 the budgeted output was 58,000 units and the actual output was 62,500 units.
What was the fixed budget for factory overheads in period 2? (show your working
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