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A manufacturing business, Grimoak, Corp., organises its production into four cost centres. Last month the company produced 60,000 items of product. Further details of the
A manufacturing business, Grimoak, Corp., organises its production into four cost centres. Last month the company produced 60,000 items of product. Further details of the costs are included in the following table: Maintenance \& repairs is a service cost centre that has worked 6,000 LH to Machining, 3,400 LH to Assembly \& finishing and 5,800 LH to Packaging. Required: 1. Using the floor area as base of apportionment, compute the cost of the factory rental (23,115) of each cost centre. 2. Calculate the overhead absorntion rate for each denartment on the followina basis: Each unit uses 2 hours of machine time in the machining department. Each unit uses 0.5 direct labour hours in the assembly and finishing department. Calculate the total production cost for one unit of the company's product
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