General Studies · Overhead Absorption Costing
The XYZ Company manufactures two products: Arnold (low-volume) and Brad (high-volume). Direct labour hours per unit are 5 hours for both. Annual output is 1,200 units for Arnold and 12,000 units for Brad. Fixed overhead costs amount to a total of $420,000. Using a traditional method of overhead absorption based on total labour hours, what is the overhead cost per unit for each unit of product Arnold (to two decimal places)?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1$35.20
- 2$24.60
- 3$31.82✓
- 4$29.40
Correct answer
$31.82
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