Calculate the Production Overhead for the Administration Department. (5) Calculate the Production Overhead for the Maintenance Department. (6)Calculate the Production Overhead for Milling and Finishin
Dee Limited’s factory comprises of two production departments, Milling and Finishing, and two service departments Maintenance and Administration. The following estimated data are provided:
| Production department | Service department | |||
| Milling | Finishing | Maintenance | Administration | |
| Budgeted overheads | 524 000 | 480 000 | 240 000 | 150 000 |
| Machine hours | 30 000 | 20 000 | ||
| Area occupied (m²) | 6 300 | 2 700 | 1 200 | 900 |
| Number of employees | 150 | 100 | 40 | 30 |
Note:
Administration department cost is allocated based on number of employees.
Maintenance department cost is allocated based on area occupied.
Production overheads are calculated based on machine hours.
Required:
Calculate the Production Overhead for the Administration Department. (5)
Calculate the Production Overhead for the Maintenance Department. (6)
Calculate the Production Overhead for Milling and Finishing (separately) based on machine hours. (6)
