QUESTION 3 Akmal Bhd. reapportions the costs incurred by two service departments, materials handling and inspection, to the three production departments, machining, finishing and assembly. The following are the overhead costs which have been allocated and apportioned to the five departments:

RM Machining 400,000 Finishing 200,000 Assembly 100,000 Materials handling 100,000 Inspection 50,000 Estimates of the benefits received by each department are as follows: Machining Finishing Assembly Materials Inspection handling % % % % % Materials handling 30 25 35 Inspection 20 30 45 10