Overheads
Question 1 (Non-Reciprocal)
Cadila Co. Ltd. has three production departments, A, B, and C, and two service departments, D and E. Below is the apportionment of costs based on the data from the company records.
| Description | Total (₹) |
|---|---|
| Rent and Rates | 5,000 |
| Indirect Wages | 1,500 |
| Dep. of Machinery | 10,000 |
| General Lighting | 600 |
| Power | 1,500 |
| Sundries | 10,000 |
Further details for apportionment:
| Basis | Total | A | B | C | D | E |
|---|---|---|---|---|---|---|
| Floor space (Sq. ft.) | 10,000 | 2,000 | 2,500 | 3,000 | 2,000 | 500 |
| Light points | 60 | 10 | 15 | 20 | 10 | 5 |
| Direct wages (₹) | 10,000 | 3,000 | 2,000 | 3,000 | 1,500 | 500 |
| H.P. of machines | 150 | 60 | 30 | 50 | 10 | - |
| Value of machinery (₹) | 2,50,000 | 60,000 | 80,000 | 1,00,000 | 5,000 | 5,000 |
Apportion the costs to various departments on the most equitable basis.
Solution
???note "Explanation"
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