1.

The modern company is divided into four departments : A B C are

production departments and S is a service dept. . the actual cost for a period
are a s followed:
Salaries 10000
Repairs to plant 6000
Deprication of plant 4500
Employees insurance 15000
Rent 15000
Fire insurance for stock 5000
Power 9000
Light 1200
Following information is available in respect of the four dept:

A B C D
Area Feets 1500 1000 2000 500
No of employees 20 15 10 5
Wages 6000 4000 8000 2000
Value of plant 30000 18000 12000 6000
Value of stock 12000 9000 6000
H P of plant 30 18 12 6

Apportion the cost to the various departments on the most equitable basis.
2. PH ltd is a manufacturing company having three production dept p1, p2 ,p3
and two service dept s1, s2. Following is the budget for Dec 2006.

Total P! P2 P3 S1 S2
D material 1000 2000 4000 2000 1000
D wages 5000 2000 8000 1000 2000
Factory Rent 40000
Power 25000
Dep 10000
Other overheads 90000
Area 500 250 500 250 500
Capital 20 40 20 5 5
Value(lakhs)
Machine Hour 1000 2000 4000 1000 1000
H P of machine 50 40 20 15 25

A technical assessment for the apportion pof expenses of service dept is as

under:

P1 P2 P3 S1 S2
% % % % %
S1 40 20 20 20
S2 60 25 15