REQUIRED 1.1 Prepare the overhead allocation statement (using traditional costing). 1.2 Calculate the allocation rate (expressed to the nearest cent) for each of the production centres, based on machine hours for Machine centres A and B and direct labour hours for Assembly. 1.3 Calculate the overheads applied to each batch of the product. INFORMATION [100 MARKS] (20 Marks) (14 marks) (3 marks) (3 marks) Perth Limited has three production centres (Machine Centre A, Machine Centre B and an Assembly Centre) and two service centres (Materials Procurement and General Manufacturing Support). The annual overhead costs are as follows: Costs R Indirect materials: Machine Centre A 300 000 Machine Centre B 483 000 Assembly 63 000 Materials Procurement 0 General Manufacturing Support 6 000 Indirect labour: Machine Centre A 600 000 Machine Centre B 600 000 Assembly 900 000 Materials Procurement 660 000 General Manufacturing Support 888 000 Heating and lighting Property tax 600 000 Insurance of machinery 90 000 Depreciation of machinery 900 000 Insurance of buildings 150 000 Salaries of works management 480 000 300 000 The following information is also provided: Carrying value Machine Centre A Machine Centre B Assembly Materials Procurement General Manufacturing Support of machinery R4 500 000 R2 700 000 R720 000 R540 000 R540 000 R9 000 000 Area occupied (m2) 6 000 3 000 9 000 9 000 3 000 30 000 Number of employees 180 120 180 60 60 600 Direct labour hours 600 000 600 000 1 200 000 0 0 2 400 000 Machine hours 1 200 000 600 000 0 0 0 1 800 000 R2 400 000 R1 800 000 R600 000 R4 800 000 Total materials issues (both direct and indirect) to the production centres are as follows: Machine Centre A Machine Centre B Assembly Secondary allocation: The value of materials issued is used as a basis for the Materials Procurement cost centre. Direct labour hours is then used as the basis for the General Manufacturing Support cost centre. The product is produced in batches of 100. Each unit spends 5 hours in the Machine Centre A, 10 hours in Machine Centre B and 10 hours in the Assembly Centre