ph ltd is a manufacturing company having the production departments a b and c and tw 559057

PH Ltd. is a manufacturing company having the production departments A, B and C and two service departments X and Y. The following is the budget for December:

Total

A

B

C

X

Y

Direct material (Rs)

1,000

2,000

4,000

2,000

1,000

Direct wages (Rs)

5,000

2,000

8,000

1,000

2,000

Factory rent (Rs)

4,000

Power (Rs)

2,500

Depreciation (Rs)

1,000

Other overheads (Rs)

9,000

Additional information:

Area (square feet)

500

250

500

250

500

Capital value of assets (In lakh rupees)

20

40

20

10

10

Machine hours

1,000

2,000

4,000

1,000

1,000

HP of machines

50

40

20

15

25

A technical assessment for the apportionment of expenses of service departments is as follows:

A(%)

B(%)

C(%)

X(%)

Y(%)

Service department X

45

15

30

10

Service department Y

60

35

5

You are required to prepare the following:

(a) A statement showing distribution of overheads to various departments.

(b) A statement showing redistribution of service departments’ expenses to production departments.

(c) Machine hour rates of the production departments A, B and C.

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