Scenario or Tasks Question 1 Delta is an electronic company manufacturing different types of products. They have appointed a new management accountant who has explained about Overheads. "Overhead is the cost incurred in the course of making a product, providing a service or running a department, but cannot be trased directly and in full so the protester servis. He also explained that there are different methods to deal with overheads to get the more accurate cost of product, which is very important to deal with competition. Delta Company has Two production departments (A, and B and two service departments (Service and Service 2). The information about the budgeted cost as given as below: D. TOM Hand IRELLI Machen SOCO Scen Pridaction power2000 are a pie The company has new premises, and all the departments are housed in this premises. The additional details about the production and service department are given below: Pepe Areas Machen WOME 0000 be 100 Le Rat RO HOMRI Snel Required: Prepare a statement showing the overhead cost for each production department showing the basis of apportionment used 4 Marks Reapportion the overheads using the direct method of reapportionment 2 Marks There are different ways to deal with the overhead, Absorption costing is a method of sharing overheads between different products on a fair basis. Discuss and Evaluate the Absorption costing procedure 4 Marks Question 2 Inventory control is a very important function of any organization Business must buy material of one kind or the other and a person is responsible to buy material and movement of it within the organization should be Question 1 Delta is an electronic company manufacturing different types of products. They have appointed a new management accountant who has explained about Overheads Overhead is the cost incurred in the course of making a product providing a service or running a department, but cannot be traced directly and in full to the product or service." He also explained that there are different methods to deal with overheads to get the more accurate cost of product, which is very important to deal with competition Delta Company has Two production departments (A, and B and two service departments (Service I and Service 2). The information about the budgeted cost as given as below: Dhrahesan Total (OM) Rental 13000 10 000 chic Machine Instance SOBO 7000 W Depreciation of machine Productos pries 3000 Itind lighting The company has new premises, and all the departments are housed in this premises, The additional details about the production and service department are given below: Department Department Bence Feet Area Someter ho T1000 Machine Value (OMR |Latha Tar 5000 10 Labour Rate per hour. 10.50 OMR) IS! 10 Service 2 bo BO Required: Prepare a statement showing the overhead cost for each production department showing the basis of apportionment used. 4 Marks Reapportion the overheads using the direct method of reapportionment 2 Marks c) There are different ways to deal with the overhead, Absorption costing is a method of sharing overheads between different products on a fair basis. Discuss and Evaluate the Absorption costing procedure. 4 Marks Question 2 Inventory control is a very important function of any organization Business must hurmaterial afone Lindor the
