Answer Happy

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