Jimbo has three production departments and a support department. The budgeted production overhead cost for the year ended 31st December 2020 is as follows: 2$ Indirect wages Department Assembly Department Painting Department Packaging Support Department 23,000 30,000 26,000 18,800 To be allocated Other cost Consumable materials 20,000 Insurance: Plant 30,000 Depreciation: Plant 22,000 Power 15,000 Rent 21,000 Light and heat 14,000 The following is the data of an appropriate basis of apportionment: Department Department Department Assembly 22,500 Support Department Painting Packaging Floor space (m²) Book value of plant($) 15,000 20,000 12,500 140,000 180,000 70,000 10,000 Electricity Kwhs 80 100 15 Machine hours 110,000 150,000 140,000 Number of store 180 120 100 requisitions (materials) Direct labour hrs 80,000 120,000 100,000 The support department's overhead should be apportioned based on direct labour hours. Required: a) Prepare the overhead analysis statement showing clearly the basis of apportionment. b) Calculate the overhead absorption rate (to 2 decimal point) for all three production departments using machine hours as the absorption base.

Jimbo has three production departments and a support department. The budgeted production overhead cost for the year ended 31st December 2020 is as follows: 2$ Indirect wages Department Assembly Department Painting Department Packaging Support Department 23,000 30,000 26,000 18,800 To be allocated Other cost Consumable materials 20,000 Insurance: Plant 30,000 Depreciation: Plant 22,000 Power 15,000 Rent 21,000 Light and heat 14,000 The following is the data of an appropriate basis of apportionment: Department Department Department Assembly 22,500 Support Department Painting Packaging Floor space (m²) Book value of plant($) 15,000 20,000 12,500 140,000 180,000 70,000 10,000 Electricity Kwhs 80 100 15 Machine hours 110,000 150,000 140,000 Number of store 180 120 100 requisitions (materials) Direct labour hrs 80,000 120,000 100,000 The support department's overhead should be apportioned based on direct labour hours. Required: a) Prepare the overhead analysis statement showing clearly the basis of apportionment. b) Calculate the overhead absorption rate (to 2 decimal point) for all three production departments using machine hours as the absorption base.

Financial And Managerial Accounting

15th Edition

ISBN:9781337902663

Author:WARREN, Carl S.

Publisher:WARREN, Carl S.

Chapter19: Support Department And Joint Cost Allocation

Section: Chapter Questions

Problem 2CMA: Adam Corporation manufactures computer tables and has the following budgeted indirect manufacturing...

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