SECTION B Answer all questions 1. Crome Plc. has budgeted costs in its various departments as follows for the next quarter (July to September):- Rent and rates Plant depreciation Light and heat Canteen costs Finishing costs 80,000 100,000 50,000 85,000 32,000 The company maintains four departments - Assembly, Finishing, Stores, and Maintenance. The overheads are to be allocated and apportioned as fairly as possible to the four departments using the information below:- Plant cost () No. of employees Floor area (m2) Assembly 25,000 10 2,000 Finishing 60,000 20 4,000 Stores Maintenance 7,500 7,500 10 10 3,000 1,000 Required: (a) Allocate and apportion the budgeted overheads to the four departments. [10 marks] (b) Further records show that the Stores Department works 50% of the time for Assembly Department, 30% for Maintenance Department, and the balance for Finishing Department, while for the Maintenance Department, it serves all the plant in each of the departments. Using this information, reapportion the Service department overheads (Stores and Maintenance) to the Production departments (Assembly and Finishing). The company has a normal practice to apportion the overheads in the Stores Department first. [7 marks] (C) The company has budgeted that the labour hours in the Assembly Department to be 20,000 hours. Based on the answers calculated in part (b) above, what is the predetermined overhead rate for the Assembly Department. [3 marks] [Total 20 marks]