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F2 pilot paper Question 44

Forums › ACCA Forums › ACCA MA Management Accounting Forums › F2 pilot paper Question 44

  • This topic has 2 replies, 2 voices, and was last updated 11 years ago by farhadmumtazacca.
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  • November 15, 2013 at 7:59 pm #146211
    godze26
    Member
    • Topics: 2
    • Replies: 1
    • ☆

    A factory consists of two production cost centres (P and Q) and two service cost centres (X and Y). The total allocated
    and apportioned overhead for each is as follows:
    P Q X Y
    $95,000 $82,000 $46,000 $30,000
    It has been estimated that each service cost centre does work for other cost centres in the following proportions:
    P Q X Y
    Percentage of service cost centre X to 50 50 – –
    Percentage of service cost centre Y to 30 60 10 –
    The reapportionment of service cost centre costs to other cost centres fully reflects the above proportions.
    After the reapportionment of service cost centre costs has been carried out, what is the total overhead for
    production cost centre P?

    This is the solution given

    Direct cost $95,000
    Proportion of cost centre X (46,000 + (0·10*30,000))*0·50 $24,500
    Proportion of cost centre Y (30,000*0·3) $9,000
    Total overhead cost for P $128,500

    My question is where did the 0.10 came from. I do not understand why that was used. Please explain

    November 15, 2013 at 8:03 pm #146213
    godze26
    Member
    • Topics: 2
    • Replies: 1
    • ☆

    I should say the 0.10 used in the workings in the apportionment for centre X.

    November 15, 2013 at 10:08 pm #146228
    farhadmumtazacca
    Participant
    • Topics: 13
    • Replies: 24
    • ☆

    slam bro because as u see Percentage of service cost centre Y to all is 30 60 10 – as we see 10 is there for X that 10 is going 2 x so we r calculating that 10 apportioned overhead hope so this will make sense to you take care.

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