Accounting

Rent and Rates A Ltd. has three production departments P, P2 & P3 and two service departments S, and Sy. The follow- ing data are extracted from the records of the company for a particular given period : 25,000 Power 7,500 General Lighting 3,000 Depreciation of Machinery 50,000 Indirect Wages 7,500 Sundry Expenses 50,000 Other information : P P2 P S S Direct-Wages (3) 15,000 10,000 15,000 7,500 2,500 H.P. of Machines used 60 30 50 10 Cost of Machinery (3) 3,00,000 4,00,000 5,00,000 25,000 25.000 Floor Space (sq. ft.) 2,000 2,500 3,000 2,000 500 Number of Light Points 10 15 20 10 5 Production Hours Worked 6,226 4,028 4,066 The Expenses of Service Departments S, and S, are apportioned below : P P2 P S S, S, 20% 30% 40% 10% 40% 20% 30% 10% 32. S2 You are required to : (a) Compute Overhead Rate per production hour of each production department. (b) Determine the Factory cost of product X which is processed for manufacture in departments P, P, and P, for 4 hours, 5 hours and 3 hours respectively, given that its direct material cost is 250 and direct labour cost is 150