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A factory consist of two production cost centres – P and Q – and a canteen S.
The total allocated and apportioned overhead for each is as follows
P – $50,000 ; Q – $62,000 ; S – $25,000
The canteen overhead is to be apportioned to the production centres on the basis of the number of the staff employed.The number of staff in each centre are as follows:
P – 120 ; Q – 80 ; S – 50.After the apportionment of the canteen cost, what is the total overhead for production centre P?
I assume you have typed out the question because you have a problem with it, and not because you are setting a test? 🙂
S is to be apportioned on the basis of staff employed.
The are servicing a total of 200 (120+80) workers in the production centres, and so the cost of S will be apportioned on that basis.So apportioned to P will be 120/200 x 25,000 = 15,000
Add this to the total already allocated to P, and you will have the total required.
You’re right sir. i really have problem with this chapter. By the way, thank you so much sir.
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