UI

dD", -narc . ,
a statement of Primary Di str1but
r•~i: . fN f k ion All

~
-.nl · (he basis O 0 0
· Wor en, · ocote the expense, on proper basla, Recreation
·
( ~ oll Prim Dl■trlbutJon Bu
'I'. . Basis of Total 1111111 for the 111011th or March 2022
9 ProducUon Departmen;, Service
~r.se Allocation I?)
A Dept.
B D S
2,000
2s,ooo 7,000 6,000
2,000
5,500 4,500 2,000
11,soo
~~
value of Plant S.Ooo 4,500 4,000 2,500 1,500
~,i,\ti011 value of Plant 11,970 3,420 3,078 2,736 1,710 1,026
tie19Pt No. of Worker 39,99 8 14,285 11,428 5,714 5,714 2,857
~~siOtl
~'1"'-"'ce of value of Stoc 16,000 7,500 5,000
s!Jr,P 2,500 1,000
No. of Worker 5,992 2,140 1,712 856 856 428
~on No. of Light
points 18,000
i,1tifl8 1.36 460
rotJI
poll : 3 (lnsU ~ce of Stock _& Repain and maintenan
ce given)
. d
...pan.Y is havmg three productton departments namely' A, B and C and tw o service epartments
;. co... •
the ex nses 1ncurre
d during th th
e mon of December 2021 are as follows :
t'°d '{. Expenses Amou nt~)
3,00,000
:~sio D 1,00,000
SUI"'" ranee on Stock
~IJ!SU 1,80,000

:=,c· andefo"'er
Lighting
raxes
60,000
1,00,000
1 1,70,000
Rel1 • and Maintenance 85,000
·
~atio n on Plant
for above departments :
l)e~ following fonnation is also available
Particulars Production Departments Service Depts.
A 8 C X y

1,500 1,000 900 500 100

i,oor space (Sq. ft.) 100 100 150 50
200
lfo. of Workers 50 20
80
ff.P. of Machine 20,00 0 20,00 0 10,000 10,000
f 30,00 0
l)ireel Wages 40,00 0
1,20,0 00 90,00 0 60,00 0 30,00 0
Vahle of Plant f
f 1,50,0 00 90,00 0 60,00 0
Value of Stock 20 10 10
40 20
f.il!t Points (Nos)
Prepare aStatement showing Primary Distributioo of Overheads.
Sallldoa (I

ution of overheads. Allocate expenses on

Mllyis: Draw in columnar fonn staJtment of primary distrib
of plant
~buis.Ailoca1e rq,airs & maintenance oo the basis of value
Statement of Primary Distribution of Oftrheada
for the lloatl a o( December 2021

._. I Basis of
Allocation
I I Total
(') .
~ti on Departments
~.....,..A-....-----=a=--~---=c-..-----=x,---,/------= y-
Service
Dept.

~!:'
lltt ~
·l>ittet 2000 0 i I
t
·No.o f workers' 3,oo:o oo ! 1.00,000 !
I f
so,ooo :
I t
so,oo o I
I 10~000 1 10~000
75,00 0 , 2s,oo o
50,00 0 , 30,00 0 , 20,00 0 i
.._,_ _ Valueof'Stock 1,00,000 I
H.P.or I I
24,00 0
i
I
I
'-lit ; Machine ; 1,80,0 00 '. 96,00 0 ; 60,00 0 , I
I
..!t!s-, 'Licht Points I
60,00 0 ,
I 24,00 0 .
I
12,00 0
I
12,000
I
6,000
1
6,000
 Accounting (f. r, B.v,m_J ft.._
142 COII ~- -,- -~:-::-:-:-- ·~~---t
2 500 12,SCJQ : 2 J
Ren t & Taxes sq ft
. . 37, 500
2s,ooo 2 ' i ,r,,J. .
Rep airs & 1,00,000
30, 000 l S,()(JO \ 2011¥j
Ma inte nan ce Value of Pla nt 60,000 45, 000
Dep rec iati on 1,70,000
7,5')() \
of Pla nt Value of Pla nt
Tot al
i -~- :-:- =-

Wustration: 4 (Welfare expenses

given) nd y and two service dtpartmcntJ St
A Company is having two producti ~
on departments namely~ ;ollows.
S2. The expenses incurred during the
month of March. 202 2 are
l Am ou n~
Expenses
Sta ff welfare Exp ens es 54~
Dep rec iati on 1,80,00Q
Rent and Taxes 2,80,00o
Power
1,50,00Q
Ins ura nce on Ass ets
90,00Q
Lighting
36,00Q

The following information is also

available for the above departments .
Par ticu lars X y Sl s2
Dir ect Wages
t 1,00,000 1,0 0,0 00 50, 000 I 30,000
Dir ect Material I
No. of Light Poi nts
t 1,50,000
30
1,0 0,0 00
15
5,0 00
10
I -
H.P of Ma chi nes
8 4 2 I 5
Val ue of Ass ets ~ In Tho usa l
nds ) 100 4 30
No. of Wo rke rs 10
100 50 50 2S
Floor Spa ce (Sq . Ft.)
600 400 200 \ 200
Prepare a Statement showing Primary
Distribution ofOvcrbcads. -
Solution
Analysis : Draw the fonnat of
primary distribution and allocate
expense on the basis of no of wor the expenses on rropcr ba.~,s. Wel
kers. fare
Prl mu y Dlltrlbut1011 Summa
r,
for the mo nth or Mu ell 202 2
Exp ens es
Total Production !Np rutm ('nt , I &n 'l~ Dt-pt.
(t) y y
Direct Material
Dim :t Wages
, Direct
Direct
Sta ff Welfare Exp. ' No. of
wo rke n
I 5,000
80. 000
54, 000
' '
\

\
s,
's.000 '
50, 000 ,
1
30,000
S2

Depreciation 24. 000 ll.0 00

: Value of A~ ts 1.8 0.0 00 ll.0 00 I 6,000
Ren t & Tn u Sq.ft..Ftoor s~ ·
1 1.25.000 5.0 00
2.8 0.0 00 37. soo I 12,500
Power 1.2 0.0 00 80. 000
· H.P. of ma chi ne• 1
l,S0 ,00 0 \ 40. 000 . 40.000
lna ura noe on Asse-ts Value of
Up tin g
Assets I
· Ug bt Points l
9(), ()00 I
80 .000
bl .~
!
l
40. 000
l.WO
20. 000
18,7 50
l
10.000
6,250
Total ~~Q OO I _ 18.QOQ '\
8,,i§s8£9 ' ,er-., m _11e9.0(.)Q ._ 6.()00 3,000
-11'!-raaitian: S (Liabilhiel for em
plo yw ... ... ._ ~
-- 00 1,§ll iW 197zso
K\1> Lid bis fi~ ~ P.
Tbt IC1lall c:OIII 1K. Q, l and S arc pro du a•
fo l~ : dt-t wtn iliiil ll -4 S-1 is a strvict

'
4.00.<XXl
1,6 0.~
l.8lJ.l).ll
~ -()~
..l-~
 ,,,
__ _________
__ :.l<'""J~i'';(io
J Am
ct _ _ _ _ _ _ _ _
t11n;'"'_
IO,lJIJ(}
l~,CJfJO
6,0 00
-,,-_ttfr 10,fJOO
',.II
d t,tllintenance 17,000
~I 8,500
·~ ~ on Plant
abo d
fonnarion is also available for ve c artmentA :
tar Departments
A B C SJ 82
I,so o 1,000 900 500 JOO
S!"ce (SQ • Ft.) 20 10 JO IS 5
f!O"r worJceCS 8 s 2
1'0· ~( ~achine I,000 1,000
~ 3,000 2,000 2,000
~.P· wages 9,000 6,000 3,000 4,000
p1a nt ~ 12,000
~t of 9,000 6,000
~ 15,ooo
91,JIJ,e of stock 2 2
. . 4
~,Jl),tepain ts ution of Overhead s.
ary Distrib
~ Statement showmg Pnm
8
nt
th e ?asis of stock and repairs on the basis of pla
A)tOCBte Fire Insurance on on of Overh eads

r----
ry Dis trib uti
Statement Sho1r1ng Prima 2022
for the month of March
al Production Departments Service Dept.
Basis of Allocation Tot S-2 ftl
Am B !fl cm S-1 (~ )I
IteJJIS ~ ..
2,000 - - - 1,000 1,000
Actual 7,500 2,5 00
. 91sges
~s io n
No . of Workers
(4 : 2 : 2 : 3 : I)
30,000 10,000

5,000
5,000

3,000
5,0 00

2,000 - - ..
l

10,000
Value of Stock
1t1suf8llC:C (5: 3: 2 : _ :J 9,600 6,000 2,400 - -
~ chi nes 18,000
H.P . of Ma
prJlt1 (8 : 5 : 2 : _: J 2,400 1,200 1,200 600 600
ht Poi nts 6,000
No . of Lig
(4 : 2 : 2 : I : 1) 1,250 250
~t
10,000 3,750 2,500 · 2,250
Floor Space (Sq. Ft.)
(15: 10 : 9: 5: 1) 3,000 1,500 2,000
RefJi
17,000 6,000 4,500
Value of Plant
Rep1irS & Main t. 750 1,000
(12 : 9 : 6 : 3 : 4) 3,000 2,250 1,500
Va lue of Plant 8,500
- -- -- -- - - -
IJePII- on Plant - - - - - -
~ ~ ~
(12: 9: 6 : 3 : 4)
Total l Ql 5QQ ~ ~
en)
ck and Sundry expenses giv
~ on : 9 (Insurance of sto nts X, Y, Z and Two Service departments S l and S2.
The
Departme enses incurred for the
GUM Ltd. bas three Production of accounts in respect of indirect exp
from the books
illlowing details are extracted
mdh ended March, 2022.
Particulars
f
10,000
!
n 12, 000
&ipenisio
9,0 00
laswan~ on stock 1,2 00
~
l.ihlingwagcs 12,000
lentandrates 6,000
!ictricPower 24,000
~ 7,800
~ ~ se s above Costs :
lected for distribution of the
~ g further details are col Departments
Particulars I
I
X y
I z I SJ I I S2

~"~ ~160,~g / so .~
1 so.o~g I
10 ,~ ,
~ o f Machines

~ -~
 t'}
~n,, ~'""" 10.l-,.)0
Nn (If • 'nt1ct-na 10.0 00 l.00 0
12 3 3 · I U
3.000 l.00 0 l.00 0
Val u" or Bt(ll('k
(4 : 3 : :2 · 2 : 1)
lndt ,---t V.'.. ,... O,n-t"t .,.atl",
12.0 00
I
I
4 ,000

2.70 0 1.80 0 3,60 0 1

I 3'10
•-~
I 1 ~ : 10 : 20 : 2 : 31
9,00 0 \
\4h ttna No. or L&ah t Poin t• 300
Cl : 3 : 4 : 2 : II 1.200 I 200 400 1 lOO
1111
Rf"nt & Ralt "tl I Floo r Spa ~
, (3 : 4 : 5 : l : l)
l l,00 0 I :2,400 3,20 0 4 ,000 1 1,60 0
Elt"Ctnc ~ r H .P. of M ach inf-1 2,4 00
6 ,000 1,600 1,80 0 200
1 (8 : 9 : 12 : l : -l
Oq, rca atio n I Valu f' of Mac hineryi 24,0 00 7,20 0 6,00 0 9,6 00 1,20 0
1 (6 : S : 8 : l : -t
Sun dry
Exp ena t'a I Dir .ct Wag ,ti 7,80 0
(ls : 10 : 20 : 2 : 3)1_ _-
2,34 0 1,56 0 3,1 20 312
T otal I
_
Wu stra tion : Io (Building Rep ain
_ 9LOOO I 22 4j0
29 6@ 28 129 10 872
given)
A compan y tw, three production depa
rtments X, Y and Z and two service dep
follov.•ing estimates of ex~ nsc s arc avai artments S-1 and S-2. i.
lable :
Par ticu lars
Staf f Can teen Expt-n&es
Insu ran ce on Machinery 2,00 ,000
lnsu ran cc on Bui ldin gs 12 ,00,000
St.a.ff Welfare ~xp ena cs 3,20 ,000
Power 6,00 ,000
Ren t and Rates 8,80,000
Dep reci atio n on Mac hine ry 6,40,000
Bui ldin g Rep ain 6.00.000
Other technical details about de rtme I 3,00 ,QOO
nts are as under :
Par tiru lara X y
Floor Spa ce ('000 aq. ft.) z S-1 S-2
10 20 30
Num ber of Wo rke n 10 lll
10 1S
H.P. of Mac hine
30 20
15 5 s
Cos t of Mac hine in Lak hs 25 15 10
5 2
Show Primary Distribution of overhead 1 1
expenses.
tion
ysll : Allocate buildings repairs on the
basis of floor space.
Dia trlb atlo a Summary
Items Basia of Tot al · Pro duc tion De1• ; Ill
App orti onm ent
Ill t t 1,1 I
 JJJ

trfb 1on)
•••·,r
-· ~ 011 : 21 (R
epeated Df• ut
ct'''. ~ I Ltd, has three producr,· on dcpartm 01111 pha, Bela, Gamma and two service department•
Al 2012 .
t,11 ' TI supplied the foll , ding Jlsl December,
,iid fhtta. IC company - - owmg lnfonnalion for the year en
~ -----
======rr
--
f:=
Rtl',---------=
~
~tricilY en.aI
d·rect 1,fat
5~
4,000
2,000
1,500
5,000
I 300
ll1 ;,.eciation
~J(SJ! enses
19· Service Dept.
Items Production Dept. Theta
Gamma Delta
Alpha Beta f
f f r f

5,000 3,000
(r) 4,000 4,000
5,000 6,000 900
-..:.«t wages (f} 500
;;er Materials (sq. ft.} 1,I~g 1,300
10
1,200
40
10
4
20
6
.ue'ofworker 8
12 10 6 9
10
/iO- of Light Points 5 10 7,500
hines 22,500
~o.
ap l.fSC , I 5,000 30,000
r:
v~e of Machines
and Theta are apportioned as unde
Departments Delta en ts
fxpenses of Service Service D ep ar tm
artments
Production Dep Delta Th et a
Beta G am m a
Alpha 10%
40% 30%
ta 20% 20%
Service Dept. D el 20% . 30%
et a 30%
Service Dept. Th
You are required to: uitable basis.
ibution summary on most eq tments expenses to
J. Prepare primary
over head di str
appo rtion ment of two Service Depar
statement showing
the ethod.
2. Also prepare a stribut ion by Repe ated Distribution M
di
ents i.e. secondary
Production Departm
n Su m m ar y
Solution: im ar y Overh ead Distributio Service Dept.
Pr ar tm en ts
Production D ep
Ba si s D el ta Th et a
Item Amount B et a G am m a
Alpha

" " " "

50 0
"
900
1,300 1,200 900
1,100 600
5, 00 0 Area 1,000 1,000
500 200 300

-- H.P. Machine
Rent 600 500
4, 00 0 400
2, 00 0 Light Point 500 600 40 0
500
~ty
1,500 Direct Material 1,000 2, 00 0 1,500
200
ladirtet Material Value of Machine 100 400 100
5, 00 0 500
~ ti o n No. of Employee
s
1,400 2,800
1,300 5,600 5, 00 0
ielfareExpenses 4,000
ar y
ibution Su m m
Secondary Distr n M et ho d)
in ut io
(Repeated D is tr Service D ep t
t.
Production Dep Th et a
Delta
Particulars G am m a
Alpha
"
B et a
"
r "
"
4,000 5, 60 0 5,000
420
1,400
1,400
2,800
140
. tnoution 280 56 0 588 2,940
588 882 58 .8 0
4: 3: J) 882 -5 88
235.20 176.40 -5 8. 80
2: 3: 2) II 7.60 11.76
11.76 17 .6 4
4: 3: 1) 17.64 - Il .7 6
5.22 3. 93
2: 3: 2J 2.61
:3 :8 ) 7,000. 18 7,499.97
5,299.85
 26 1

20 %
r's sa lal Y 20 % 20
~%
40 10 00
~~~ 80
12 00
de red by 16 00
en t
fo 50 % 30 % 20 %
.
bour h ou r rat e rea ch of the d , B-1 1 & C-1 11
2 SCrvicep artrnen t A-1
fol low ing i• the pri ma ry
y bas 3 Pro du cti on & e dep art me nts. Fo r a pe rio d • the
su of co sts :
ar s Se rvi ce De pt.
1-A Pr od uc tio n De pt. V- E
111-C lV -D
0 11- B 60 00
16 00
c,y erb ea ds (R s.) 14 00 0 10 00 0 46 80
ts on
ser vic e de pa n er ser vic e de pa rtm en
~ e,q ,en ses of the pe rce nta ge s: me nts are ch arg ed to the Pro du cti on & oth
: i,asis off olJ ow in V- E
lar s 1-A 11-B IV -D 10 %
:;:....-ticu ID -C
r-_;;;.
-0 20 % 40 % %
JV 30 - .
40 % 20% 20 '¾o 20°/co
v-E ea ted di st rib utl on
the ex pe ns es of ser vic e d the pro du cti on de pa rtm en ts by rep
rtio n epan:ments to of
.
J\ P~ . du cti on ho ur rat e
; . t the pro
u are su pp lie d ea wi th the fol low in g inf on na tio n & req uir ed to wo rk ou
ry of ov erh d in De pa nm en ts R, s & T.
"(o
recove Se rv ice De pt .
rtic u]a rs To tal Pr od uc tio n De pt.
pa T Sl
R I S
40 00 .
16 00
48 00 96 00 40 00 60 0
24 00 0 80 0
80 00 40 00 l 00 0 20 00
~t . 'ty 16 00 16 00
;...,,mCl
~~t La bo ur
12
10
00 0
00 0
24
50
00
00
40
32
00
00
~gg 2
iooo
60 0
40 0
60 0
:;; ~t io n 90 00 18 20 42 86 16 94
. 50 00 28 00
sunc1nes - 20 00
~t ed W or kin g Hr s. S2 are ap po rti on ed as
llllder:
Es Ex nse s of ser vic e de pa rtm en ts
R
S l &
s T Sl
S2
10 %
]
J)a rti cu lar s 40 % 20 %
30 %
S1 od
d Di str ibu tio n me th
y be ap po rti on ed wi th the he lp of Re pe ate
de pa rtm en t ma
The expenses of se rv iceua tio n me tho d. ha lf ye ar en de d 30
th
an eo us Eq an y for the
& also Sim ult bo ok s of He av y Me tal
s Co mp
fol low ing da ta w as ob tai ne d fro m the
24. The
Sept, 2023. Se m ce De pt .
Pr od uc tio n De pt. I S2
Pa rti cu lar s S1

Direct Wa ge s
Pl
14 00 0
I P2
12
50
00
00
0 I
P3
10 00
40
I
00
0 20
30 0000
10 0
\
20 00
20 00
10 0 _]
60 00 30 0 . 30 0 1
Ma ter ial 60 00
Dire ct
lmployees
40 0
12 00 0 I
12 00 0
40 00
10
llectricity Kw h
s.
16 00 0
20 30
40 00
I
30
0 20 00
10 I
0 l 20 00 0
J.i&ht Po int s in No
10 00 00 60 00 0 I
12 00 I 40 0 I 40 0
AD ets Va lue 16 00 12 00
Area occu ied in . m trs .
hs are : To ta l
The expenses for 6 mont 80 0
Pa rti cu lar s
30 00
.._SlirJ)O el'
'el'heads
ea O\IU 40 00
60 00
a.: tn cli gh t 12 00 0
we lfa re 24 00
20 00 0
& ma in te na nc e 12 00
09erheads in g cle ar ly the ba sis
• 1aaies rtm en ts sh ow
pnmary dis tti bu rio o summary for the de pa
are
V~ ~ re qu nd IO prep
l "-bett necessary .
,I 268 IP'lP''IP"
Coat Accounting (T.Y. 8,Com.) (St
"'·'~J
7
25. From the following lnfom,ation, work out the produc tion hour rate of recovery of ovcrhcll(J8
d artment PD-l PD-TI & PD-Ill.
In
Particulars Service Dept.
Total Production Dept. s1
PD-1 PD-II PD-III
Rent 20000 3000
4000 8000 3000
Electricity 600 400
4000 1000 1600
Fire Insurance 1200 1200
8000 1600 3200
Plant Depreciation 80000 20000 6000
20000 30000
Transport 8000 2000
1000 1000 lOOO
Estimated Working Hrs. 20000 50000 36000
Ex enses of service de artments S1 & S2 are a rtioned as uo<ler:
Particulars PD-I PD-II 81 s2
PD-III _
S1 30% 01
40-ro 20% 10%
20%
S2 10% 20% SO%
~ , ~ e expenses of service department may be apportt·oned 'th the help ofRepeated Distribution meth
Jli· wt
~~ani Ltd. has 3 production & 2 service departments. The compa . th fi . in£ Od.
ny supp1ies e O11owmg 0 nnation
for the year ended 31 st Dec, 2022:
Particulars Tota}
Rent 10000
Power sooo
Electricity 4000
Indirect Material 3000
Depreciation 10000
Welfare Expenses 2600

Particulars Production Dept. Service Dept. ~

I n I III IV I V
Direct Wages 8000 10000 6000 -
Direct Material 10000 12000 8000 - -
Area in sq.ft. 2200 2600 2400 1000
-
No. of Workers 1800
100 20 80 20 40
No. of Light points 16 24 20 8 12
HP Machin~s 10 20 20 12
Value of Machines 18
30000 60000 45000 - 15000
Expenses of service departments are apportioned as under
Particulars I II III IV V
IV 20% 40% 30% - 10%
V 30% 20% . 30%
You are required to prepare:
20% -
1. Prepare primary distribution summary of overheads on most
suitable basis
2. Also prepare a statement showing the re-apportionment of
overheads of 2 service departments into
production departments by repeated distnbution method .
28. Funlcy Ltd has 3 service departments D, E & F and 2 produc
tion departments X & Y. Following are the
expenses allocated & apportioned to the departments as per primar
y distribution summary.
Service Dept.
Production Dept.
D I E I F X l y
60000 I 48000 I 72000 180000 l 240000
Additional infonnation :
Particulars Service Dept.
Production Dept.
D E F X y
D - 20% 30% 30% 20%
E - - 40% 30%
.. F - - - 60%
30%
40%
Prepare a statement showmg apporttonment of semce departments
overheads as per Step down method.