A company produces several products which pass through the two production departments in its

factory. These two departments are concerned with filling and sealing operations. There are two

service departments, maintenance and canteen, in the factory.

Predetermined overhead absorption rates, based on direct labour hours, are established for the two

production departments. The budgeted expenditure for these departments for the period just ended,

including the apportionment of service department overheads, was 110,040 for filling, and

53,300 for sealing. Budgeted direct labour hours were 13,100 for filling and 10,250 for sealing.

Service department overheads are apportioned as follows:

During the period just ended, actual overhead costs and activity were as follows:

Required:

Calculate the overheads absorbed in the period and the extent of the under/over absorption in each

of the two production departments.

\\begin{tabular}{l|l|l|l} \\hline Maintenance & - & Filling & \70 \\\\ \\hline Maintenance & - & Sealing & \27 \\\\ \\hline Maintenance & - & Canteen & \3 \\\\ \\hline Canteen & - & Filling & \60 \\\\ \\hline Canteen & - & Sealing & \32 \\\\ \\hline Canteen & - & Maintenance & \8 \\\\ \\hline \\end{tabular} \\begin{tabular}{l|l|l|} \\hline & \\( (\\mathfrak{f}) \\) & Direct labour hours \\\\ \\cline { 3 - 3 } & 74260 & 12820 \\\\ \\hline Filling & 38115 & 10075 \\\\ \\hline Sealing & 25050 & \\\\ \\hline Maintenance & & \\\\ \\hline Canteen & 24375 & \\\\ \\hline \\end{tabular}