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    Argosy University/ Phoniex University/
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    Phoniex University
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Category > Accounting Posted 15 Sep 2017 My Price 10.00

budgeted production

1    The annual budgeted production overheads for a factory with two production departments (Machine Shop A and Machine Shop B) and one service department (Stores) are as follows:

 

 

Indirect wages and supervision Machine Shop A

£

 

150,000

£

Machine Shop B

100,000

 

Stores

30,000

 

 

Indirect materials

 

280,000

Machine Shop A

100,000

 

Machine Shop B

50,000

 

Stores

10,000

 

 

 

160,000

Rent

 

60,000

Light and heat

 

30,000

Insurance for machinery

 

20,000

550,000

 

The  following information  is also available:

 

 

 

 

Area occupied (sq  m)

Book value of machinery (£)

Issues of direct and  indirect

 

Machine Shop A 20,000

60,000

 

Machine Shop B 5,000

20,000

 

Stores

 

5,000

 

material from stores  (£)

Budgeted machine hours

 

350,000               200,000

 

Machine Shop A            36,000 machine hours Machine Shop B                 9,500 machine hours

You  are required to:

 

(a)        Determine the budgeted overhead absorption rate for Machine Shop A.

 

 

(b)        Determine the budgeted overhead absorption rate for Machine Shop B.

(c)        Calculate the production overheads which would  be charged to Product X if the product spent 6 hours in Machine Shop A and 3 hours in Machine Shop B.

 

Answers

Maurice Tutor
(5)
Status NEW Posted 15 Sep 2017 09:09 AM My Price 10.00

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