(a)[4]
Fill in the table to show how the service department costs are apportioned to the production departments.
(b)[4]
Calculate, to two decimal places, an appropriate overhead absorption rate for each production department.
(c)[4]
Calculate the amount of over-absorption or under-absorption of overheads for each production department.
(d)[2]
State two likely reasons why a business may under-absorb overheads.
(e)[1]
Calculate the budgeted direct labour rate per hour for the production departments.
(f)[6]
Prepare a statement showing the total selling price that X Limited will quote to the customer.
(g)[2]
Explain why a business allocates service department costs to production departments.
(h)[7]
Advise the directors whether they should make this change or not. Justify your answer.