P.10.3 Deccan Manufacturing Limited has three departments which are regarded as production depart- ments. Service department's costs are distributed to these production departments using the "Step Ladder Method" of distribution. Estimates of factory overhead costs to be incurred by each department in the forthcoming quarter are as follows. Data required for distribution is also shown against each department. Department Factory overheads Direct labour-hours Number of Area in square employees metres Production $1,93,000 4,000 100 3,000 Y 64,000 3.000 125 1,500 z 83,000 4.000 85 1,500 y44 (Contd.) DOD 10 50 40 50 (Contd.) Service 45,000 1.000 500 75,000 5.000 1,500 1,05,000 6.000 1.000 30,000 3,000 1.000 The overhead costs of the 4 service departments are distributed in the same order, namely, P,Q,R and S respectively on the following basis: Departments Basis Number of employees Direct labour-hours Area in square metres S Direct labour-hours You are required to: (a) Prepare a schedule showing the distribution of overhead costs of the four service departments to the three production departments, and (b) Calculate the overhead recovery rate per direct labour-hour for each of the three production departments. P