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Edward Ltd comprises of three production departments and two service departments. The following information is provided for Edward Ltd for 2019. £ Supervisor's salaries Machining 300,000 Assembly 200,000 Finishing 250,000 Canteen 120,000 Maintenance 150,000 £ 300,000 200,000 60,000 80,000 90,000 75,000 Factory Rent Heat and light General Repairs Machine Depreciation Machine insurance Business Rates Machining Assembly Finishing Canteen 200 200 150 400 200 50 Floor space occupied (m2) 400 Value of machinery (£'000) 300 The service departments work for the other departments as follows: Service carried out by: Canteen Maintenance 30% 25% Machining Assembly Finishing Canteen Maintenance 30% 50% Maintenance 40% 25% 50 50 Required: a. Using Edward's Ltd overhead analysis sheet for 2019, determine the overhead allocated and apportioned to each of the five departments. b. Calculate the total overheads included in the production departments after the reapportionment of the service department using direct method

Edward Ltd comprises of three production departments and two service departments. The following information is provided for Edward Ltd for 2019. £ Supervisor's salaries Machining 300,000 Assembly 200,000 Finishing 250,000 Canteen 120,000 Maintenance 150,000 £ 300,000 200,000 60,000 80,000 90,000 75,000 Factory Rent Heat and light General Repairs Machine Depreciation Machine insurance Business Rates Machining Assembly Finishing Canteen 200 200 150 400 200 50 Floor space occupied (m2) 400 Value of machinery (£'000) 300 The service departments work for the other departments as follows: Service carried out by: Canteen Maintenance 30% 25% Machining Assembly Finishing Canteen Maintenance 30% 50% Maintenance 40% 25% 50 50 Required: a. Using Edward's Ltd overhead analysis sheet for 2019, determine the overhead allocated and apportioned to each of the five departments. b. Calculate the total overheads included in the production departments after the reapportionment of the service department using direct method

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Edwara Ltd comprises of three production departments and two service departments. The following information is provided for Edward Ltd for 2019. £ Supervisor's salaries Machining Factory Rent Heat and light General Repairs Machine Depreciation Machine insurance Business Rates 300,000 Assembly 200,000 Finishing 250,000 Canteen 120,000 Maintenance 150,000 £ 300,000 200,000 60,000 80,000 90,000 75,000 Floor space occupied (m2) 400 Value of machinery (£'000) 300 Service carried out by: Canteen Machining Assembly Finishing Canteen Maintenance The service departments work for the other departments as follows: 200 400 30% 25% 200 200 30% 50% 150 50 Machining Assembly Finishing Canteen Maintenance 40% 25% Maintenance 50 50 Required: a. Using Edward's Ltd overhead analysis sheet for 2019, determine the overhead allocated and apportioned to each of the five departments. b. Calculate the total overheads included in the production departments after the reapportionment of the service department using direct method
Transcribed Image Text:Edwara Ltd comprises of three production departments and two service departments. The following information is provided for Edward Ltd for 2019. £ Supervisor's salaries Machining Factory Rent Heat and light General Repairs Machine Depreciation Machine insurance Business Rates 300,000 Assembly 200,000 Finishing 250,000 Canteen 120,000 Maintenance 150,000 £ 300,000 200,000 60,000 80,000 90,000 75,000 Floor space occupied (m2) 400 Value of machinery (£'000) 300 Service carried out by: Canteen Machining Assembly Finishing Canteen Maintenance The service departments work for the other departments as follows: 200 400 30% 25% 200 200 30% 50% 150 50 Machining Assembly Finishing Canteen Maintenance 40% 25% Maintenance 50 50 Required: a. Using Edward's Ltd overhead analysis sheet for 2019, determine the overhead allocated and apportioned to each of the five departments. b. Calculate the total overheads included in the production departments after the reapportionment of the service department using direct method
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