Rolex Ltd planned to produce 500,000 units for the coming year using 120,000 labour hours. Question 1 Planned fixed overhead costs amount to $420,000 and overhead is absorbed on a labour hour basis. Determine the fixed overhead over or under absorbed in each of the following situations: (a) The company produced 480,000 units but used 125,000 labour hours; and fixed overhead (b) The activity level was as planned but actual overhead cost incurred was $385,000. cost was as planned. (c) The company produced 510,000 units and used 118,000 hours. The actual fixed overhead costs incurred amounted to $465,000. Question 2 Mandeville Ltd planned to produce 200,000 units of " X ", using 40,000 machine hours at an expected fixed overhead cost of $340,000. Fixed overheads are absorbed on a machine hour basis. Calculate the amount of fixed cost over or under absorbed if: (a) The company produced 210,000 units using 38,000 machine hours and actual fixed overhead cost incurred was $350,000. (b) The company incurred the same fixed cost as planned but produce the 200,000 units using 40,500 hours. (c) The company produced 190,000 units at a fixed cost of $290,000, using 30,000 hours