The production manager of Sweet Deco has suggested that "as the actual overheads incurred and units produced are usually different from the budgeted and as a consequence profits of each month, it would be more accurate to calculate the actual overhead cost per unit each month end by dividing the total number of all units actually produced during the month into the actual overheads incurred". 

Do you agree with the production manager's suggestion? Provide your explanation?

Answer rating: 100% (QA)

It could be a reasonable approach to calculate the actual overhead cost per unit each month ... View the full answer