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accounting question!!!!!!!!!!1




Question;Question 3Lewitt PLC has asked for your help in designing their new costing system. You haveascertained that they have two direct production departments: manufacturing and finishing,and two production overhead departments: stores and canteen.The allocated costs in the period are budgeted to be:Manufacturing ?360,000 Stores ?120,000Finishing ?320,000 Canteen ?30,000Costs to be apportioned:Rent on basis of floor area ?26,000Machine depreciation on basis of original cost of machinery ?60,000Management time on basis of time spent in each dept. ?120,000Floor Area Machinery ManagementSq mtrs Original cost TimeManufacturing 300 ?450,000 48%Finishing 100 ?30,000 32%Stores 50 ?5,000 5%Canteen 70 ?15,000 15%Stores Number ofRequisitions EmployeesManufacturing 150 35Finishing 10 25Stores N/A N/ACanteen 40 N/ABudgeted machine hours in manufacturing department is 25,183Budgeted direct labour hours in finishing department is 27,095Required:Calculate the overhead absorption rate for the manufacturing and finishing departments.


Paper#44894 | Written in 18-Jul-2015

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