Question

DKM Leicester Limited manufactures Student metal beds in three production departments in their Leicester production hub: The departments are Manufacturing, Finishing, and Packaging. DKM Leicester Limited also have three service departments, namely: Quality Control, Stores and Maintenance. The company uses an absorption costing system to analyse product costs, and you have been supplied with the following information in relation to the production departments as indicated in Table 1 below:

Base	Manufacturing	Finishing	Packaging	total
No of employees	20	16	17	53
Machine value	100000	75000	6000	235000
Fac tory area	218	260	290	768
Factory volume	26000	44000	40000	110000
Water usage	15000	12000	12000	39000
Machine hour	95000	56000	26000	177000