Question
The following business has 5 departments: Department A, B and C are production units and Cleaning and Maintenance service units. Overheads for Department A
The following business has 5 departments: Department A, B and C are production units and Cleaning and Maintenance service units. Overheads for Department A is calculated on machine hours Service departments costs are allocated sequentially, and Maintenance department is allocated first. Cleaning is allocated by floor space Maintenance is allocated by machine hours A B C Cleaning Maintenance Machine 100 250 75 5 10 Hours Floor Space 150 200 120 50 60 Total 50 000 75 000 25 000 15 000 17 500 Overheads
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