The main distributer of natural juices uses two processes for its production process. The fruit juices pass through a distillery and a canning department. Both departments incur overheads; however, management wants to assess the total overheads absorbed in each department. The information below relates to the budgeted overheads for each department prepared by the cost controller:

Cost	Distillery	Canning
Machining	$4,000,000	$12,000,000
Production set-up costs	$16,000,000	$12,000,000
Material handling cost	$14,000,000	$4,000,000
Inspection	$6,000,000	$4,000,000
Machine hours	800,000	4,000,000
Direct labour hours	20,000,000	2,000,000

For the period ended 30 June 2020 the actual overheads incurred amounted to $100,000,000 of which 60% relates to distillery and the remainder to canning. The production manager also provided data for the period which indicates that total direct labour hours are 20% more than expected. Meanwhile machine hours are 200,000 and 1,400,000 more than planned for distillery and canning respectively. The budgeted direct wages were the same as planned.

Required:

(a) Outline the two main factors that may result in an under/over absorption of overheads at the entity. (4 marks)

(b) Calculate the overhead absorption rates for both departments. (6 marks)

(c) Calculate the under/over absorption of overheads for each department. (6 marks)

(d) Distinguish between overhead apportionment and allocation (4 marks)