Accounting · Absorption Costing
D Ltd operates a total absorption costing system. The budgeted fixed overheads for the year were $175,000 and the budgeted production was 5,000 units. During the year, the actual fixed overheads incurred were $186,000 and the actual production achieved was 6,000 units. What is the over- or under-absorption of fixed overheads?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1Over-absorbed by $24,000✓
- 2Over-absorbed by $11,000
- 3Under-absorbed by $11,000
- 4Under-absorbed by $24,000
Correct answer
Over-absorbed by $24,000
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