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Q1. Cadila Co. Has Three Production Departments A, B and C and Two Service

The document contains 6 questions related to overhead apportionment and distribution across production and service departments. Details such as department expenses, floor space, assets, machine hours, employees, etc. are provided. Respondents are asked to apportion overhead costs across departments using various methods like equitable basis, ratio method, repeated distribution method and simultaneous equation method.

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3K views5 pages

Q1. Cadila Co. Has Three Production Departments A, B and C and Two Service

The document contains 6 questions related to overhead apportionment and distribution across production and service departments. Details such as department expenses, floor space, assets, machine hours, employees, etc. are provided. Respondents are asked to apportion overhead costs across departments using various methods like equitable basis, ratio method, repeated distribution method and simultaneous equation method.

Uploaded by

medha sur
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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Q1. Cadila Co.

has three production departments A, B and C and two service


departments D & E.

Expenses Rs
Rent & Rates 5000
Indirect Wages 1500
Dep of Machinery 10000
General Lighting 600
Power 1500
Sundries 10000

The following further details are also available:

Particulars Total A B C D E
Floor Space Sq 10000 2000 2500 3000 2000 500
ft
Light Points No 60 10 15 20 10 5
Direct Wages Rs 10000 3000 2000 3000 1500 500
HP of No 150 60 30 50 10 -
machines
Value of Rs 250000 60000 80000 100000 5000 5000
Machinery

Apportion the costs to various departments on most equitable basis


Q2. The following data were obtained from the books of Glaxo Co. for the half year
ended 30th Sep, 2020. Prepare an Overhead distribution summary

Production Departments Service Departments


A B C X Y
Direct Rs. 7000 6000 5000 1000 1000
Wages
Direct Rs. 3000 2500 2000 1500 1000
Materials
Employees Nos. 200 150 150 50 50
Electricity Kwh. 8000 6000 6000 2000 3000
Light Points Nos. 10 15 15 5 5
Asset Values Rs. 50000 30000 20000 10000 10000
Area Sq yrds 800 600 600 200 200
Occupied

The Expenses for 6 months were:

Particulars Rs.
Stores OH 400
Motive Power 1500
Electric Lighting 200
Labour Welfare 3000
Depreciation 6000
Repairs & Maintenance 1200
General OH 10000
Rent & Taxes 600

Apportion the expenses of Department X in the ratio 4:3:3 and that of Department Y in
proportion to direct wages to department A, B and C respectively.
Q3. Calculate the Overheads applicable to Production Department A & B. There are
also two service departments X & Y. X renders service worth Rs. 12000 to Y and balance
to A and B as 3:2. Y renders service to A and B as 9:1.

Particulars A B X Y
Floor Space (sq ft) 5000 4000 1000 2000
Assets (Rs. In lacs) 10 5 3 1
HP of machines 1000 500 400 100
No. of workers 100 50 50 25
Light Points 50 30 20 20

Expenses Rs.
Depreciation 190000
Rent & rates 36000
Insurance 15200
Power 20000
Canteen Expenses 10800
Electricity 4800

Q4. A manufacturing company has two production departments X and Y and three
service departments, time-keeping, stores and maintenance. The departmental
summary showed the following expenses for October:

Production Departments: (In Rupees)


X 16, 000
Y 10,000 26,000

Service Departments:
Time-keeping 4,000
Stores 5,000
Maintenance 3,000 12,000
38,000

The other information is:


PARTICULARS Production Service Departments
Departments
X Y Time- Stores Maintenance
Keeping
No. of Employees 40 30 20 16 10
No. of Stores 24 20 - - 6
requisitions
Machine Hours 2,400 1,600 - - -

You are required to make departmental allocation of expenses

Q5. Kartik Cute produces the following details. They have three production
departments namely A, B, C and two service departments namely D & E

Particulars Details
Total Departmental Overhead as per Primary Distribution is as
follows:
Dept A 63000
Dept B 74000
Dept C 28000
Dept D 45000
Dept E 20000

The company decided to charge the service department costs on the basis of the
following:

Departments A B C D E
D 40% 30% 20% Nil 10%
E 30% 30% 20% 20% Nil

Find the total Overheads of production departments by Repeated Distribution Method

Q6. There are 2 Production Departments A & B and Two service Departments, Boiler
room & pump Room.

Particulars Details
Total Departmental Overhead as per Primary Distribution is as
follows:
Dept A 500000
Dept B 400000
Dept Boiler Room 300000
Dept Pump Room 60000

The company decided to charge the service department costs on the basis of the
following:

Departments A B Boiler Room Pump Room


Boiler Room 60% 35% - 5%
Pump Room 10% 40% 50% -

Find the total Overheads of production departments by Simultaneous Equation Method

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