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A company runs two production cost centres M1 and M2, and two service cost centres S1 and S2. The total allocated and apportioned overheads for

A company runs two production cost centres M1 and M2, and two service cost centres S1 and S2. The total allocated and apportioned overheads for each are as follows:

M1

M2

S1

S2

30,000

35,000

10,000

15,000

It has been estimated that each service cost centre does work for other cost centres in the following proportions:

M1

M2

S1

S2

% of service cost centre S1 to:

55%

45%

-

-

% of service cost centre S2 to:

40%

45%

15%

-

Calculate the total overheads for production cost centre M1 after the reapportionment of service cost centre costs have been carried out.

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