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Hero Bhd. has two Production Departments 1 and 2 and two ancillary Service Departments X and Y. The following are the expected overhead costs for the next 6 months: Overhead RM Depreciation of equipment Depreciation of factory buildings Factory heating Factory cleaning 20,000 24,000 8,000 4,000 Factory canteen 5,400 The following information relates to the Production and Service Departments of the Factory: Production Service Dept 1 Dept 2 Dept. X Dept. Y Volume in cubic metres 1,000 2,000 600 400 Floor area in şgure mettEs 800 600 400 200 Number of employees 140 100 70 50 Book of equipment RM10,000 RM15,000 RM9,000 RM6,000 Machine hours 4,000 1,000

Hero Bhd. has two Production Departments 1 and 2 and two ancillary Service Departments X and Y. The following are the expected overhead costs for the next 6 months: Overhead RM Depreciation of equipment Depreciation of factory buildings Factory heating Factory cleaning 20,000 24,000 8,000 4,000 Factory canteen 5,400 The following information relates to the Production and Service Departments of the Factory: Production Service Dept 1 Dept 2 Dept. X Dept. Y Volume in cubic metres 1,000 2,000 600 400 Floor area in şgure mettEs 800 600 400 200 Number of employees 140 100 70 50 Book of equipment RM10,000 RM15,000 RM9,000 RM6,000 Machine hours 4,000 1,000

Principles of Cost Accounting
Principles of Cost Accounting
17th Edition
ISBN:9781305087408
Author:Edward J. Vanderbeck, Maria R. Mitchell
Publisher:Edward J. Vanderbeck, Maria R. Mitchell
Chapter5: Process Cost Accounting—general Procedures
Section: Chapter Questions
Problem 16E: Chavez Concrete Inc. has two production departments. Blending had 1,000 units in process at the...
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Required: 

  1. Calculate the overhead to be absorbed by each Department stating clearly the basis of apportionment used.  
  2. Transfer the Service Department costs to Production Departments 1 and 2 on the basis of machine hours.  
  3. Calculate a machine hour overhead absorption rate for Departments 1 and 2.  

 

Hero Bhd. has two Production Departments 1 and 2 and two ancillary Service Departments X and Y. The following are the expected overhead costs for the next 6 months: Overhead RM Depreciation of equipment 20,000 Depreciation of factory buildings 24,000 Factory heating 8,000 Factory cleaning 4,000 Factory canteen 5,400 The following information relates to the Production and Service Departments of the Factory: Production Service Dept 1 Dept 2 Dept. X Dept. Y Volume in cubic metres 1,000 2,000 600 400 Floor area in şgure mettes 800 600 400 200 Number of employees 140 100 70 50 Book of equipment RM10,000 RM15,000 RM9,000 RM6,000 Machine hours 4,000 1,000
Transcribed Image Text:Hero Bhd. has two Production Departments 1 and 2 and two ancillary Service Departments X and Y. The following are the expected overhead costs for the next 6 months: Overhead RM Depreciation of equipment 20,000 Depreciation of factory buildings 24,000 Factory heating 8,000 Factory cleaning 4,000 Factory canteen 5,400 The following information relates to the Production and Service Departments of the Factory: Production Service Dept 1 Dept 2 Dept. X Dept. Y Volume in cubic metres 1,000 2,000 600 400 Floor area in şgure mettes 800 600 400 200 Number of employees 140 100 70 50 Book of equipment RM10,000 RM15,000 RM9,000 RM6,000 Machine hours 4,000 1,000
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