Mono Limited is a manufacturing company with production and service cost centres. The following budgeted information...
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Mono Limited is a manufacturing company with production and service cost centres. The following budgeted information relates to 2015. Overhead allotted Machine hours Direct labour hours Material handling Maintenance Assembling Finishing GH#760,000 GH550,000 COST CENTRES 140,000 60,000 65% 35% Material Handling GH 170,000 200,000 40,000 USAGE OF SERVICE COST CENTRES 30% 55% 10% Maintenance GH210,000 5% a. Prepare an overhead analysis sheet indicating the basis of apportionment. b. Use the direct allocation, repeated distribution (reciprocal), simultaneous equation and specified order of closing methods to apportion the service departments to the production departments. 2. Calculate an appropriate overhead absorption rate for each production department. Mono Limited is a manufacturing company with production and service cost centres. The following budgeted information relates to 2015. Overhead allotted Machine hours Direct labour hours Material handling Maintenance Assembling Finishing GH#760,000 GH550,000 COST CENTRES 140,000 60,000 65% 35% Material Handling GH 170,000 200,000 40,000 USAGE OF SERVICE COST CENTRES 30% 55% 10% Maintenance GH210,000 5% a. Prepare an overhead analysis sheet indicating the basis of apportionment. b. Use the direct allocation, repeated distribution (reciprocal), simultaneous equation and specified order of closing methods to apportion the service departments to the production departments. 2. Calculate an appropriate overhead absorption rate for each production department.
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