Absorption Costing Flashcards
1
Q
Does Halfpenny use absorption costing?
A
Yes
2
Q
How are overheads absorbed?
A
Machine hours with a different rate for each of the five production departments (mixing and kneading, shaping and proving, baking, cooling and packaging)
Separate rates for variable ad fixed OH.
3
Q
Does Halfpenny use standard costing?
A
Yes.
4
Q
How are the standards set?
A
Standards updated annually.
Normal raw material losses incorporated in standard costs.
Idle time not budgeted for.
