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A company has two production (Assembly and Testing) departments and one service department (Canteen). The data for the next production period is as follows: Assembly
A company has two production (Assembly and Testing) departments and one service department (Canteen). The data for the next production period is as follows:
Assembly | Testing | Canteen | |
Total overheads () | 114,000 | 170,000 | 44,000 |
Machine hours (hrs) | 50,000 | 37,000 | - |
Labour hours | 15,000 | 52,000 | - |
No of employees | 375 | 1,300 | 17 |
Labour hour rate () | 6.50 | 9.10 | 6.38 |
All employees make use of the Canteen department. The company is calculating its overhead recovery rates. Calculate the total overheads that will be charged to the Assembly Department. Calculate and enter your answer in the same format as the labour hour rate.
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