Casual sports limited has two production departments which are Machining and Assembling and one maintenance service department . The below budgeted estimates are for year 1.

ParticularsMachiningAssemblyMaintenanceTotal

No of employees160120120400

Floor Area (Sq/mtr)7,0005,0004,00016,000

Power (Kilowatt hours)70,00052,50017,500140,000

Direct Machine Hours14,000400-14,400

Direct Labor hours1,0006,000-7,000

Information:

Indirect material$300$268$320$888

Indirect wages$2,720$1,480$860$5,060

Value of machinery$52,000$48,000$100,000

Below is annual budgeted overheads in:USD ($)

Rent12,800

Machine depreciation10,000

Power7,200

Supervision of employees6,400

Indirect material888

Indirect Labor5,060

Total overheads42,348

Required:

a)Prepare overhead allocation sheet and reapportion maintenance department cost to the two production departments on the basis of value of machinery.( 6 )

b)Calculate overheads absorption rates for each production department based on machine hours for Machining department and direct labor hours for Assembling department. (3)

c)Make a job order cost sheet for Job no 001 and calculate selling price if the profit margin is 20% of selling price. Consider the below information. (6)

MachiningAssembly

Direct material in $3,500100

Direct labor in $5001,400

Machine hours10010

Direct Labor hours2060

Answer rating: 100% (QA)

a Overhead Allocation Sheet ParticularsMachiningAssemblyMaintenanceTotal Value of Machinery520004800... View the full answer