Ormond Company manufactures both toothpaste and tooth whitener, with each product manufactured in separate departments. Three support department support the production department: Power, General Factory and Purchasing. Budgeted data on the five departments are as follows: Support Departments Producing Departments Power General Purchasing Toothpaste Tooth Overhead R90 000 Factory R420 000 R180 000 R141 600 Whitener R175 000 Square feet 3 000 - 3 000 9 600 8 400 Machine 1 403 1 345 8 000 24 000 hours Purchase 20 40 7 60 120 orders The company does not break overhead into fixed and variable components. The bases for allocation are: power - machine hours; general factory-square feet; and purchasing - purchase orders. Required: 5.1 Allocate the overhead costs to the producing departments using the direct method (round allocation ratios to four decimals). (14) Question 6 (5 marks) You are required to identify which of the CVP assumptions is violated in each of the following circumstances described below: a. b. C. d. e. Labour costs and selling prices increases over time within the relevant range. Price per unit declines as the volume of sales and production increase. The sales mix in a multi-product firm varies as the volume of total sales changes. Costs behave according to a curvilinear function Sales and production volume differ.