Tshintsha (Pty) Ltd is a manufacturer of three
types of inverters namely grid-tied, off-grid and
hybrid inverters. Tshintsha uses an absorption
costing system. The following information is
available for the financial year ended 29
February 2024:
Product Grid- Off- Hybrid
tied grid
Budgeted number of 10 00015 000 20 000
inverters produced
Actual number of 8 00016 000 21 000
inverters produced
Budgeted machine 1,25 1,0 1,4
hours per unit
Actual machine hours 1,2 1,1 1,3
per unit
1. The fixed manufacturing overheads
(FMO) are allocated to products based
on the machine time spent. The total
budgeted FMO for the year was
R13 014 750 and the total actual FMO
was R12 498 600.
2. There was no budgeted or actual
opening or closing inventory of any type.
The budgeted FMO allocation rate per machine
hour (rounded to two decimal places) for the
2024 financial year was:
Tshintsha (Pty) Ltd is a manufacturer of
three types of inverters namely grid-tied,
off-grid and hybrid inverters. Tshintsha
uses an absorption costing system. The
following information is available for the
financial year ended 29 February 2024:
Product Grid- Off- Hybrid
tied grid
Budgeted number 10 000 15 20 000
of inverters 000
produced
Actual number of 8 000 16 21 000
inverters produced 000
Budgeted machine 1,25 1,0 1,4
hours per unit
Actual machine 1,2 1,1 1,3
hours per unit
1. The fixed manufacturing overheads
(FMO) are allocated to products
based on the machine time spent.
The total budgeted FMO for the
year was R13 014 750 and the total
actual FMO was R12 498 600.
2. There was no budgeted or actual
opening or closing inventory of any
type.
For this question only assume that the
FMO allocation rate per machine hour is
R200
The FMO allocated to product Grid-tied in
the Actual statement of profit and loss
for the 2024 financial year is:
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