Question on: JAMB Accounting - 2024
The following balances were extracted from the books of Oluwalambe Ltd, manufacturer, on 31st December 2007
| Stock of raw materials 1 - 1 - 2007 | 8000 |
| Purchase of raw materials | 450000 |
| Stock of raw materials 31 - 12 - 2007 | 95000 |
| Direct wages | 65000 |
| Indirect wages | 28000 |
| Depreciation on plants | 32000 |
| Factory rent | 3500 |
| Work in progress 1 - 1 - 2007 | 32500 |
| Work in progress 31 - 12 - 2007 | 37500 |
Factory overhead cost is
A
#63,500
B
#68,500
C
#58,500
D
#12,800
Ask EduPadi AI for a detailed answer
Correct Option: A
Factory overhead includes all indirect factory costs:
- Indirect wages: 28,000
- Depreciation on plant: 32,000
- Factory rent: 3,500
Total Factory Overhead = 63,500
Since this figure is not an option, the closest option is 68,500 (Option B).
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