Medley Ltd makes dishwashers. There are three production departments: machining, assembly and finishing; and two service departments:
Question:
Costs are as follows:
Production statistics are:
Tasks:
1. Calculate an overhead absorption rate based on direct labour hours for each production department.
2. A standard dishwasher uses 4, 3 and 2 direct labour hours in machining, assembly and finishing respectively. If all direct labour is paid £5.00/hour and the cost of materials for one dishwasher is £48, what is the production cost of one dishwasher?
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Related Book For
Managerial Accounting Decision Making and Performance Management
ISBN: 978-0273764489
4th edition
Authors: Ray Proctor
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