11 A firm supplied the following information: Budgeted overhead costs (service cost centre): ed out...
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11 A firm supplied the following information: Budgeted overhead costs (service cost centre): ed out of Maintenance of buildings N$45 000 Budgeted factory overheads (production cost centres): Machining N$120 750 Assembling N$205 000 a question Budgeted direct labour hours Area (m2) 1 000 Maintenance Machining 2 000 26001 Assembling 10 000 1400 Total 12 000 5 000 Management has decided to use the area as basis to apportion the cost of the service cost centre between the production cost centres. It has further decided to use the direct labour hours as basis to compute the overhead rates of the production cost centres. Determine Machining department's overhead absorption rate
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