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1) Jason Ltd has two production departments (A and B) and two service departments (Maintenance and Stores). Budgeted overheads for the next year are shown
1) Jason Ltd has two production departments (A and B) and two service departments (Maintenance and Stores). Budgeted overheads for the next year are shown below: Heat and light Repair costs Machinery depreciation Rent and rates Canteen Machinery insurance RM 19,200 9,600 54,000 38,400 9,000 25,000 Details of each department are as follows: Floor area (m) Machinery book value (RM000) Number of employees Allocated overheads (RM000) Material acquisition (%) A 6,000 48 50 15 40 B 4,000 20 40 20 60 Maintenance 3,000 8 20 12 Stores 2,000 4 10 5 Total 15,000 80 120 52 Calculate total overhead costs for each of the departments and reallocate overheads of service departments to production departments based on material acquisition
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