02 Mar A company has two production departments and two s
A company has two production departments and two service departments. The data relating to a kperiod are as follows. Particulars Prod. Dept. I Prod. Dept. II Service Dept I Service Dept II Direct Materials 80,000 40,000 10,000 20,000 Direct Wages 95,000 50,000 20,000 10,000 Overheads 80,000 50,000 30,000 20,000 Power requirement at normal capacity operation (Kwh) 20,000 35,000 12,500 17,500 Actual power consumption (Kwh) 13,000 23,000 10,250 10,000The power requirement of these departments are met by a power generation plant. The said plant incurred an expenditure which is not included above, of Rs.1,21,875 out of which a sum of Rs. 84,375 was variable and the rest fixed.After apportionment of power generation plant costs to the four departments, the service department overheads are to be redistributed on the following basis. Departments Prod. Dept I Prod. Dept II Service Dept I Service Dept II Service Dept I (%) 50 40 10 Service Dpet II 60 20 20 You are required to,i. Apportion the power generation plant costs to the four departmentsii. Reapportion service department cost to production departmentsiii. Calculate the overhead rate per direct labor hour of production departments, given that the direct wages rates of Production Dept I, II are Rs. 5 and Rs. 4 per hour respectively.
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