TTT (Pty) Ltd has two production departments A and B. The company manufactures tailor made winter clothes made out of wool. Apart from the two production departments, it has also two service departments, namely: Marketing and Distribution. Being a capital intensive entity, TTT (Pty) Ltd uses machine hours as an allocation base in the two capital intensive production departments. Total machine hours for the two production departments amounted to 4 000 hours of which 60% relate to production department A while the balance relates to production department B. According to the information obtained from the company's cost accountant, total allocated and apportioned general overheads after the primary allocation for each department are as follows: Departments A B Marketing Distribution N$250 N$ N$ 40 000 N$ 80 000 Primary allocation 000 160 000 The cost accountant further pointed out that the two service departments perform services for both production departments and to one another in the following proportions. Departments B Marketing Distribution A % of Marketing to 50 30 20 % of Distribution 60 25 15 to REQUIRED: MARKS 12 4.1 What are the overheads allocated to each production department if the secondary allocation is done according to the simultaneous equation method? 4.2. Calculate departmental absorption rates for A and B following the secondary allocation in 4.1. 3 TOTAL MARKS FOR QUESTION 4 15