Prod 1 Prod 2 Stores dept Maintenance dept Overhead costs $ 24,000 16,000 10,000 8,000 Cost of material requisitions 40,000 35,000-15,000 M'nance hours needed (hrs) 8,000 4, 500 1,500 Required: a) Use the repeated distribution method to apportion the overhead costs of the two service ceritres b) Ascertain the total overhead costs of the production departments c) Compare the overall cost of the production departments using the repeated distribution method and the traditional overhead absorption method, d) Comment on the benefits or drawbacks of using the repeated distribution method of overhead absorption
Prod 1 Prod 2 Stores dept Maintenance dept Overhead costs $ 24,000 16,000 10,000 8,000 Cost of material requisitions 40,000 35,000-15,000 M'nance hours needed (hrs) 8,000 4, 500 1,500 Required: a) Use the repeated distribution method to apportion the overhead costs of the two service ceritres b) Ascertain the total overhead costs of the production departments c) Compare the overall cost of the production departments using the repeated distribution method and the traditional overhead absorption method, d) Comment on the benefits or drawbacks of using the repeated distribution method of overhead absorption
Principles of Cost Accounting
17th Edition
ISBN:9781305087408
Author:Edward J. Vanderbeck, Maria R. Mitchell
Publisher:Edward J. Vanderbeck, Maria R. Mitchell
Chapter4: Accounting For Factory Overhead
Section: Chapter Questions
Problem 8P: Journalizing the distribution of service department costs to production departments
Required:
Using...
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Prod 1 Prod 2 Stores dept Maintenance dept
repeated distribution method of overhead absorption
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