Question 7.4 Warburton Ltd produces several products which pass through two production departments in its factory. These two departments are concerned with cutting and finishing. The company also has two service departments, maintenance and canteen.

Service department costs are allocated as follows:

Maintenance:

Cutting 75%

Finishing 20%

Canteen 5%

Canteen:
Cutting 60%
Finishing 30%
Maintenance 10%
During the period just ended actual overheads were as follows:
£
Cutting 71 500 Finishing 47 300 Maintenance 25 100 Canteen 24 300 Allocate all overheads in order to calculate the overheads absorbed by the production departments.