Question
4. You are required to apportion the service department costs to production departments using direct distribution method in respect of the following: Amount Per
4. You are required to apportion the service department costs to production departments using direct distribution method in respect of the following: Amount Per Basis for Service Production Production Expense Head Month (Rs.) Distribution Department(S.) Department(P.) Department(P) Depreciation 260 Floor 3,200 Sq Ft 3,200 Sq Ft 4,000 Sq Ft of building space Depreciation 2,000 Direct 400 8,00 800 of machinery Taxes on 208 Value of X32,000 32,000 40,000 building building Power 1,200 Relative 40 80 80 80 demand (KWH) Sundry Expenses 1,200 No. 10 20 30 workers The expenses of the service department are shared between P, and P, in the ratio of 1:2. The total direct labour hours per month are estimated to be 4,304 and 6,790 for P, and P, respectively. [20]
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