TREE is a business producing in batches to customers$$ order. The business has two production departments: Printing and Packing. There is one service department, maintenance

The following information is available:

$($i$)$ Two types of materials are held in inventory. Basic materials and Deluxe materials. Basic materials are purchased to customers$$ order.

$($ii$)$ Production workers are paid $10$ per hour

$($iii$)6$ production workers work for $40$ hours per week and for $46$ weeks per year for the printing department and $3$ production workers work for $40$ hours per week and for $46$ weeks per year for the packing department

$75\%$ of the hours worked by production workers can be chargeable to customers$$ order

$($iv$)$ Annual overheads are estimated to be:

$$

Rent and rates $60000$

Heat, light and utilities $40000$

Equipment depreciation $80000$

Production supervision salaries $72000$

$($v$)$ The maintenance department salaries directly allocated $40500$ per year

$($vi$)$ Other information:

Printing Packing Maintenance

Floor area $($Sqm$)$

Production workers

Machinery value $(000)1000$

$6$

$120800$

$3$

$60200$

$--$

$20$

$($vii$)$ It is estimated that the services of Maintenance are utilized $60\%$ Printing and $40\%$ Packing

Required:

$($a$)$ Calculate the overheads to be allocated and apportioned to each of the three departments

$($b$)$ Re$-$apportion the total maintenance department cost to the two production departments

$($c$)$ Calculate an overhead recovery rate for each of the two production departments based upon direct labour hours

A customer has requested a Quotation for an order to TREE. The following information is available for a Quotation:

Raw materials

Basic materials: $400$ packs of $3$ per pack

Deluxe materials: purchased at a cost of $1020$

Direct labour

Printing $60$ hours

Packing $40$ hours

Pricing policy

A mark$-$up of $20\%$ on cost

$($d$)$ Prepare the Quotation for the customers$$ order