Exercise 3 BB Ltd. is a manufacturing company having three production departments, A, B, and C and two service departments X and Y. The following is budget for December 2007. Overhead Total A B C Indirect Material 2000 1000 Indirect wages 1000 2000 Factory Rent 4000 Power 2500 Depreciation 1000 Other Overhead 9000 Additional Information: A B Y Area (sq.ft.) 500 250 500 250 500 Capital value of Assets 20 20 10 10 Machine hours 1000 2000 4000 1000 1000 Horse power of machines 50 40 20 15 25 A technical assessment of apportionment of expenses of service departments is as under: B Y Service Department (3) 45% 15% 30% 10% Service Department (Y) 60% 35% 5% Required: A statement showing allocation of overheads to various departments. A statement showing re-allocation of service department's expense to production departments. 40 Exercise 3 BB Ltd. is a manufacturing company having three production departments, A, B, and C and two service departments X and Y. The following is budget for December 2007. Overhead Total A B C Indirect Material 2000 1000 Indirect wages 1000 2000 Factory Rent 4000 Power 2500 Depreciation 1000 Other Overhead 9000 Additional Information: A B Y Area (sq.ft.) 500 250 500 250 500 Capital value of Assets 20 20 10 10 Machine hours 1000 2000 4000 1000 1000 Horse power of machines 50 40 20 15 25 A technical assessment of apportionment of expenses of service departments is as under: B Y Service Department (3) 45% 15% 30% 10% Service Department (Y) 60% 35% 5% Required: A statement showing allocation of overheads to various departments. A statement showing re-allocation of service department's expense to production departments. 40