Question 5 (12 Marks) In a factory with four production departments and two service departments, the operating costs for

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Question 5 (12 Marks)
In a factory with four production departments and two servicedepartments, the operating costs for the month of October were asshown below. R
Production Department 1
700,000
Production Department 2
300,000
Production Department 3
400,000
Service departments
Canteen
78,000
Boiler house
100,000
1,578,000
The costs of running the canteen are apportioned to eachdepartment on the basis of the estimated use of the canteen byemployees in each department.
The costs of the boiler house are apportioned on the basis ofthe estimated consumption of power by each department.
The service departments’ costs are therefore apportioned asfollows: Canteen
Boiler house
%
%
Production Department 1
40
30
Production Department 2
20
30
Production Department 3
30
20
Service departments
Canteen
-
20
Boiler house
10
-
Required:
Prepare a statement showing the allocation of costs to theproduction departments.