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Question 1: The following information is available for a manufacturing organisation for the past year's activities: Actual manufacturing overheads R175 000 Actual direct labour hours 25 000 Budgeted manufacturing overheads R125 000 Actual sales R600 000 Budgeted direct labour hours 20 000 Actual profit for the year R185 000. Calculate the under - or over absorption of overheads.
Option A. R50 000 under-absorption of overhead
Option B. R18 750 under-absorption of overhead
Option C. R18 750 over-absorption of overhead
Option D. R50 000 over-absorption of overhead
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