Accounting 9706 · AS & A Level · Traditional costing methods

Traditional costing methods — practice question

A manufacturing business operates with two production departments, assembly and painting. The information given is as follows. Assembly department: - machinery at net book value: $\$150\,000$ - machinery repair costs: $\$14\,000$ - machine operating hours: $60\,000$ - number of machines: $30$ Painting department: - machinery at net book value: $\$100\,000$ - machinery repair costs: $\$6\,000$ - machine operating hours: $15\,000$ - number of machines: $10$ For the year, the total machinery insurance cost was $\$5000$. What amount of insurance should be apportioned to the assembly department?

  • A$\$3000$
  • B$\$3500$
  • C$\$3750$
  • D$\$4000$

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