Ch 3 · Overheads — Absorption Costing

🧮 Formula sheet

1. 1.Absorption Rate = Budgeted Overhead / Budgeted Base
2. 2.Machine Hour Rate = Total Machine Overheads / Total Machine Hours
3. 3.Under/Over absorption = Absorbed OH − Actual OH
4. 4.Blanket Rate = Total Factory Overhead / Total Hours (single rate for all depts)