Day: August 21, 2023

Accounting Multiple Choice Question – 21 August 2023

The home of multiple choice questions for all your KS3, KS4 and KS5 Business Studies, Economics and Accounting requirements.

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Alex plc uses a predetermined direct labour rate of £5.40 per hour to absorb production overhead.

Each unit of product manufactured requires four direct labour hours

The following information is available for a period.

  • actual production overhead – £518,400
  • under-absorbed production overhead – £32,400

What was the actual output of the product in the period?

Select ONE answer:

  1. 22,500 units
  2. 24,000 units
  3. 25,500 units
  4. 30,000 units

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Accounting KS5 classes.

The answer is 1

  1. Correct – £518,400 – £32,400 = £486,000 / £5.4 = 90,000 hours / 4 = 22,500 units
  2. Not correct
  3. Not correct
  4. Not correct

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