Accounting and Finance Management Accounting Computer-Based Exemplars Int 2/Higher 3841
Autumn 1998 HIGHER STILL Accounting and Finance Management Accounting Computer-Based Exemplars Overhead Apportionment Int 2/ Higher Support Materials *+,-./
This publication may be reproduced in whole or in part for educational purposes provided that no profit is derived from the reproduction and that, if reproduced in part, the source is acknowledged. First published 1998 Higher Still Development Unit PO Box 12754 Ladywell House Ladywell Road Edinburgh EH12 7YH Accounting and Finance - Management Accounting - Overhead Apportionment - Int 2/Higher
INTRODUCTION Teacher/Lecturer Notes The aim of this pack is to provide exemplar spreadsheet questions for student use. The pack, which targets both Intermediate 2 and Higher Levels, will permit students to gain further experience in the use of spreadsheets. The structured questions in the pack are designed to allow students to progress from Intermediate 2 to Higher where appropriate. The first section of the pack contains the student questions split into separate tasks with exemplar spreadsheet templates and formulae worksheets. The final section contains comprehensive solutions for each question including spreadsheet and formulae worksheets. It is suggested that where software facilities permit, students should be encouraged to print the embedded formulae in preference to completing a formulae worksheet. This pack will be provided on CD ROM to enable users to customise questions to suit their individual client group requirements.
Accounting and Finance - Management Accounting - Overhead Apportionment - Int 2/Higher
ACCOUNTING AND FINANCE MANAGEMENT ACCOUNTING INTERMEDIATE 2/HIGHER COMPUTER-BASED EXEMPLARS OVERHEAD APPORTIONMENT Accounting and Finance - Management Accounting - Overhead Apportionment - Int 2/Higher
Accounting and Finance - Management Accounting - Overhead Apportionment - Int 2/Higher
Accounting and Finance Contents Management Accounting Overhead Apportionment QUESTIONS EXERCISE LEVEL PAGE 1 Intermediate 2 1 2 Intermediate 2 5 3 Intermediate 2 9 4 Intermediate 2/Higher 13 5 Intermediate 2/Higher 17 6 Intermediate 2/Higher 21 7 Higher 26 8 Higher 31 9 Higher 36 SOLUTIONS EXERCISE LEVEL PAGE 1 Intermediate 2 43 2 Intermediate 2 49 3 Intermediate 2 55 4 Intermediate 2/Higher 61 5 Intermediate 2/Higher 66 6 Intermediate 2/Higher 72 7 Higher 78 8 Higher 86 9 Higher 94 Accounting and Finance - Management Accounting - Overhead Apportionment - Int 2/Higher
Accounting and Finance - Management Accounting - Overhead Apportionment - Int 2/Higher
Accounting and Finance: Management Accounting - Overhead Apportionment - Int 2/Higher Abercorn Manufacturing has decided to use a spreadsheet to perform 2 tasks. Task 1 is to use an existing spreadsheet as a basis of apportioning overhead costs to Production and Service Departments. Task 2 is to amend the spreadsheet formulae/data in response to a range of "what if" situations. EXERCISE 1 - TASK 1 Read carefully the data below and then carry out the instructions which follow. DATA (a) (b) Overhead costs have to be apportioned to the Production Departments using an appropriate basis. Overhead costs of the Service Department have to be apportioned to the Production Departments on the basis of number of employees. INSTRUCTIONS 1 Load spreadsheet APQ01T1 into your computer and enter your name in cell E1. 2 Using the data above, complete the spreadsheet by entering the appropriate formulae into all cells marked with an f. 3 Save your amended spreadsheet as APQ01T1S. 4 Print your completed spreadsheet. 5 Complete the Formulae Worksheet (Question 1 - Task 1) by writing down the appropriate formulae from your spreadsheet. Abercorn Manufacturing is interested to know how the departmental overheads would be affected if the following changes occurred. EXERCISE 1 - TASK 2 Read carefully the data below and then carry out the instructions which follow. DATA (a) The business decides to introduce more machines, changing the value of fixed assets to: Department A - 80,000 Department B - 20,000 Service Department - unchanged As a result, the depreciation overhead is doubled (b) With new equipment the business decides to expand its premises, changed the floor area percentages to: Department A - 60% Department B - 10% Service Department - 30% As a result, the figure for light and heat is increased to 290 (c) Overhead costs of the Service Department have to be apportioned to the Production Departments on the basis of floor area INSTRUCTIONS 1 Load the amended spreadsheet APQ01T1S into your computer. 2 Using the data above, complete the spreadsheet by entering the appropriate data and formulae. 3 Save your amended spreadsheet as APQ01T2S. 4 Print your completed spreadsheet. 5 Complete the Formulae Worksheet (Question 1 - Task 2) by writing down the appropriate formulae from your spreadsheet. Cost Elements/Systems: Overhead Apportionment 1
Accouting and Finance: Management Accounting - Overhead Apportionment - Int 2/Higher Q1 TASK 1 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 A B C D E ABERCORN MANUFACTURING Student Name (a) Basis of Apportionment Apportionment Data Production Production Service TOTAL Dept A Dept B Dept Floor Area 30% 20% 50% 100% Number of Employees 10 8 12 30 Value of Fixed Assets 30,000 10,000 20,000 60,000 (b) Apportionment Overhead Light and Heat 280 Depreciation of Machinery 240 Rent and Rates 700 Repairs to Equipment 1,350 Indirect Materials 300 Indirect Wages 750 Overhead Analysis Production Production Service Method of Dept A Dept B Dept Apportionment Light and Heat f f f f Depreciation of Machinery f f f f Rent and Rates f f f f Repairs to Equipment f f f f Indirect Materials f f f f Indirect Wages f f f f Departmental Total f f f Service Department f f f Total Overheads f f APQ01T1.XLS 2
Accounting and Finance: Management Accounting - Overhead Apportionment - Int 2/Higher Formulae Worksheet (Question 1 - Task 1) Complete this worksheet with the appropriate formula for each spreadsheet cell as indicated. Item Cell Formula Light and Heat (Dept A) B27... Depreciation of Machinery (Dept B) C28... Rent and Rates (Service Dept) D29... Repairs to Equipment (Dept A) B30... Indirect Materials (Dept B) C31... Indirect Wages (Service Dept) D32... Departmental Total (Dept A) B33... Service Dept (Dept B) C34... Service Dept (Method of Apportionment) E34... Total Overheads (Dept A) B35... Cost Elements/Systems: Overhead Apportionment 3
Accounting and Finance: Management Accounting - Overhead Apportionment - Int 2/Higher Formulae Worksheet (Question 1 - Task 2) Complete this worksheet with the appropriate formula for each spreadsheet cell as indicated. Item Cell Formula Service Dept (Dept A) B35... Service Dept (Dept B) C35... Service Dept (Method of Apportionment) E35... Cost Elements/Systems: Overhead Apportionment 4
Accounting and Finance: Management Accounting - Overhead Apportionment - Int 2/Higher Blackburn plc has decided to use a spreadsheet to perform 2 tasks. Task 1 is to use an existing spreadsheet as a basis of apportioning overhead costs to Production and Service Departments. Task 2 is to amend the spreadsheet formulae/data in response to a range of "what if" situations. EXERCISE 2 - TASK 1 Read carefully the data below and then carry out the instructions which follow. DATA (a) (b) Overhead costs have to be apportioned to the Production Departments using an appropriate basis. Overhead costs of the Service Department have to be apportioned to the Production Departments on the basis of number of employees. INSTRUCTIONS 1 Load spreadsheet APQ02T1 into your computer and enter your name in cell E1. 2 Using the data above, complete the spreadsheet by entering the appropriate formulae into all cells marked with an f. 3 Save your amended spreadsheet as APQ02T1S. 4 Print your completed spreadsheet. 5 Complete the Formulae Worksheet (Question 2 - Task 1) by writing down the appropriate formulae from your spreadsheet. Blackburn plc is interested to know how the departmental overheads would be affected if the following changes occurred. EXERCISE 2 - TASK 2 Read carefully the data below and then carry out the instructions which follow. DATA (a) (b) (c) The business decides to introduce more machines, changing the value of fixed assets to: Machine Shop - 90,000 Assembly - 30,000 Service Department - 30,000 As a result, the depreciation overhead is increased to 2,000 and repairs to plant changes to 625 With new equipment the number of employees is changed to: Machine Shop - 100 Assembly - 150 Service Department - 50 As a result, the figure for supervision is increased to 210 The basis of reapportionment from the Service Department to the production departments should be changed to the value of fixed assets rather than the number of employees. INSTRUCTIONS 1 Load the amended spreadsheet APQ02T1S into your computer. 2 Using the data above, complete the spreadsheet by entering the appropriate data and formulae. 3 Save your amended spreadsheet as APQ02T2S. 4 Print your completed spreadsheet. 5 Complete the Formulae Worksheet (Question 2 - Task 2) by writing down the appropriate formulae from your spreadsheet. Cost Elements/Systems: Overhead Apportionment 5
Accounting and Finance: Management Accounting - Overhead Apportionment - Int 2/Higher Q2 TASK 1 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 A B C D E BLACKBURN plc Student Name (a) Basis of Apportionment Apportionment Data Machine Assembly Service TOTAL Shop Department Department Floor Area (sq ft) 40,000 30,000 10,000 80,000 Number of Employees 200 400 400 1,000 Value of Fixed Assets 30,000 10,000 20,000 60,000 (b) Apportionment Overhead Rent 320 Repairs to Plant 600 Depreciation of Plant 468 Light and Power 320 Supervision 200 Plant Insurance 720 Overhead Analysis Machine Assembly Service Method of Shop Department Department Apportionment Rent f f f f Repairs to Plant f f f f Depreciation of Plant f f f f Light and Power f f f f Supervision f f f f Plant Insurance f f f f Departmental Total f f f Service Department f f f Total Overheads f f APQ02T1.XLS 6
Accounting and Finance: Management Accounting - Overhead Apportionment - Int 2/Higher Formulae Worksheet (Question 2 - Task 1) Complete this worksheet with the appropriate formula for each spreadsheet cell as indicated. Item Cell Formula Rent (Machine Shop) B28... Repairs to Plant (Assembly Dept) C29... Depreciation of Plant (Service Dept) D30... Light and Power (Machine Shop) B31... Supervision (Assembly Dept) C32... Plant Insurance (Service Dept) D33... Departmental Total (Machine Shop) B34... Service Dept (Assembly Dept) C35... Service Dept (Method of Apportionment) E35... Total Overheads (Machine Shop) B36... Cost Elements/Systems: Overhead Apportionment 7
Accounting and Finance: Management Accounting - Overhead Apportionment - Int 2/Higher Formulae Worksheet (Question 2 - Task 2) Complete this worksheet with the appropriate formula for each spreadsheet cell as indicated. Item Cell Formula Service Dept (Machine Shop) B35... Service Dept (Assembly Dept) C35... Service Dept (Method of Apportionment) E35... Cost Elements/Systems: Overhead Apportionment 8
Accounting and Finance: Management Accounting - Overhead Apportionment - Int 2/Higher Cameron Ltd has decided to use a spreadsheet to perform 2 tasks. Task 1 is to use an existing spreadsheet as a basis of apportioning overhead costs to Production and Service Departments. Task 2 is to amend the spreadsheet formulae/data in response to a range of "what if" situations. EXERCISE 3 - TASK 1 Read carefully the data below and then carry out the instructions which follow. DATA (a) (b) Overhead costs have to be apportioned to the Production Departments using an appropriate basis. Overhead costs of the Service Department have to be apportioned to the Production Departments on the basis of number of employees. INSTRUCTIONS 1 Load spreadsheet APQ03T1 into your computer and enter your name in cell E1. 2 Using the data above, complete the spreadsheet by entering the appropriate formulae into all cells marked with an f. 3 Save your amended spreadsheet as APQ03T1S. 4 Print your completed spreadsheet. 5 Complete the Formulae Worksheet (Question 3 - Task 1) by writing down the appropriate formulae from your spreadsheet. Cameron Ltd is interested to know how the departmental overheads would be affected if the following changes occurred. EXERCISE 3 - TASK 2 Read carefully the data below and then carry out the instructions which follow. DATA (a) (b) (c) The floor areas are to change to: Spinning Department - 8,000 sq ft Weaving Department - 16,000 sq ft Service Department - 8,000 sq ft Some of the overheads have been miscalculated and are changed to: Rent and Rates - 1,000 Light and Heat - 300 Supervision - 300 The basis of reapportionment from the Service Department to the production departments should be changed to the value of floor area rather than the number of employees. INSTRUCTIONS 1 Load the amended spreadsheet APQ03T1S into your computer. 2 Using the data above, complete the spreadsheet by entering the appropriate data and formulae. 3 Save your amended spreadsheet as APQ03T2S. 4 Print your completed spreadsheet. 5 Complete the Formulae Worksheet (Question 3 - Task 2) by writing down the appropriate formulae from your spreadsheet. Cost Elements/Systems: Overhead Apportionment 9
Accounting and Finance: Management Accounting - Overhead Apportionment - Int 2/Higher Q3 TASK 1 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 A B C D E CAMERON LTD Student Name (a) Basis of Apportionment Apportionment Data Spinning Weaving Service TOTAL Department Department Department Floor Area (sq ft) 10,000 20,000 5,000 35,000 Number of Employees 40 15 5 60 Value of Fixed Assets 30,000 10,000 10,000 50,000 (b) Apportionment Overhead Rent and Rates 420 Indirect Materials 1,200 Depreciation of Equipment 250 Light and Heat 105 Supervision 480 Administration 120 Overhead Analysis Spinning Weaving Service Method of Department Department Department Apportionment Rent and Rates f f f f Indirect Materials f f f f Depreciation of Equipment f f f f Light and Heat f f f f Supervision f f f f Administration f f f f Departmental Total f f f Service Department f f f Total Overheads f f APQ03T1.XLS 10
Accounting and Finance: Management Accounting - Overhead Apportionment - Int 2/Higher Formulae Worksheet (Question 3 - Task 1) Complete this worksheet with the appropriate formula for each spreadsheet cell as indicated. Item Cell Formula Rent and Rates (Spinning Dept) B28... Indirect Materials (Weaving Dept) C29... Depreciation of Equipment (Service Dept) D30... Light and Heat (Spinning Dept) B31... Supervision (Weaving Dept) C32... Administration (Service Dept) D33... Departmental Total (Spinning Dept) B34... Service Dept (Weaving Dept) C35... Service Dept (Method of Apportionment) E35... Total Overheads (Spinning Dept) B36... Cost Elements/Systems: Overhead Apportionment 11
Accounting and Finance: Management Accounting - Overhead Apportionment - Int 2/Higher Formulae Worksheet (Question 3 - Task 2) Complete this worksheet with the appropriate formula for each spreadsheet cell as indicated. Item Cell Formula Service Dept (Spinning Dept) B35... Service Dept (Weaving Dept) C35... Service Dept (Method of Apportionment) E35... Cost Elements/Systems: Overhead Apportionment 12
Accounting and Finance: Management Accounting - Overhead Apportionment - Int 2/Higher Ferguson Foods Ltd has decided to use a spreadsheet to perform 2 tasks. Task 1 is to use an existing spreadsheet as a basis of apportioning overhead costs to Production and Service Departments. Task 2 is to amend the spreadsheet formulae/data in response to a range of "what if" situations. EXERCISE 4 - TASK 1 Read carefully the data below and then carry out the instructions which follow. DATA (a) (b) Overhead costs have to be apportioned to the Production Departments using an appropriate basis. Depreciation is to be allocated as shown: Production Department A 300 Production Department B 410 Service Department - Canteen 110 Service Department - Office 480 (c) (d) (e) Overhead costs of the Service Departments have to be apportioned to the Production Departments on the basis of: Office: Number of employees Canteen: Value of fixed assets The costs associated with 2 jobs carried out during the month were as follows: Job X Job Y Direct Materials 12.80 23.90 Direct Labour Hours 6 @ 4.10 9 @ 5.24 Overheads - Dept A 1 labour hr 1 labour hr Overheads - Dept B 2 mach hrs 1 mach hr The profit mark-up on Job X is 10% on total cost and on Job Y 15% on total cost. INSTRUCTIONS 1 Load spreadsheet APQ04T1 into your computer and enter your name in cell E1. 2 Using the data above, complete the spreadsheet by entering the appropriate (a) data into all cells marked with a d; (b) formulae into all cells marked with an f. 3 Save your amended spreadsheet as APQ04T1S. 4 Print your completed spreadsheet. 5 Complete the Formulae Worksheet (Question 4 - Task 1) by writing down the appropriate formulae from your spreadsheet. Cost Elements: Overhead Apportionment 13
Accounting and Finance: Management Accounting - Overhead Apportionment - Int 2/Higher Ferguson Foods Ltd wants to be sure that its system of allocating and apportioning overheads results in the lowest possible prices to customers. With this in mind the Management Accountant has decided to make the following changes to the present system. EXERCISE 4 - TASK 2 Read carefully the data below and then carry out the instructions which follow. DATA (a) Depreciation is to be allocated as Department A 1,546; Department B 753; Canteen 1,500 and Office 201. (b) Rent and Rates are 500 and Power 759. (c) Labour hours are changed to Department A 150 and Department B 50. (d) Machine hours are changed to Department A 500 and Department B 100. INSTRUCTIONS 1 Load the amended spreadsheet APQ04T1S into your computer. 2 Using the data above, complete the spreadsheet by entering the appropriate data and formulae. 3 Save your amended spreadsheet as APQ04T2S. 4 Print your completed spreadsheet. Cost Elements: Overhead Apportionment 14
Accounting and Finance: Management Accounting - Overhead Apportioment - Int 2/Higher Q4 TASK 1 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 A B C D E F FERGUSON FOODS LTD Student Name (a) Basis of Apportionment Apportionment Data Production Production Service Dept Service TOTAL Dept A Dept B Canteen Office Floor Area 30% 50% 10% 10% 100% Number of Employees 50 20 10 20 100 Value of Fixed Assets 12,000 18,000 10,000 6,000 46,000 Machine Hours per Department 400 200 Labour Hours per Department 100 100 (b) Apportionment Overhead Allocated Depreciation 1,300 Productive Wages 14,200 Rent and Rates 300 Light and Heat 500 Power 920 Overhead Analysis Production Production Service Dept Service Method of Dept A Dept B Canteen Office Apportionment Allocated Depreciation d d d d f Productive Wages f f f f f Rent and Rates f f f f f Light and Heat f f f f f Power f f f f f Departmental Total f f f f Service Department - Office f f f f Departmental Total f f f Service Department - Canteen f f f Total Overheads f f Overhead Asorption Production Production Dept A Dept B Machine Rate per Hour f f Labour Rate per Hour f f Job Costing Job X Job Y Materials d d Labour f f Overheads - Department A f f Overheads - Department B f f Total Cost f f Add: Profit f f Selling Price f f APQ04T1.XLS 15
Accounting and Finance: Management Accounting - Overhead Apportionment - Int 2/Higher Formulae Worksheet (Question 4 - Task 1) Complete this worksheet with the appropriate formula for each spreadsheet cell as indicated. Item Cell Formula Allocated Depreciation (Method of Apportionment) F28... Productive Wages (Dept A) B29... Rent and Rates (Dept B) C30... Light and Heat (Canteen) D31... Power (Office) E32... Departmental Total (Dept A) B33... Machine Rate per Hour (Dept B) C43... Labour (Job X) B50... Overheads - Dept A (Job Y) C51... Overheads - Dept B (Job X) B52... Total Cost (Job Y) C53... Profit (Job X) B54... Selling Price (Job Y) C55... Cost Elements/Systems: Overhead Apportionment 16
Accounting and Finance: Management Accounting - Overhead Apportionment -Int 2/Higher Greenend plc has decided to use a spreadsheet to perform 2 tasks. Task 1 is to use an existing spreadsheet as a basis of apportioning overhead costs to Production and Service Departments. Task 2 is to amend the spreadsheet formulae/data in response to a range of "what if" situations. EXERCISE 5 - TASK 1 Read carefully the data below and then carry out the instructions which follow. DATA (a) (b) Overhead costs have to be apportioned to the Production Departments using an appropriate basis. Rates are to be allocated as shown: Production Department - Binding 650 Production Department - Packing 850 Service Department - Warehouse 430 Service Department - Office 100 (c) (d) (e) Overhead costs of the Service Departments have to be apportioned to the Production Departments on the basis of: Office: Value of fixed assets Warehouse: Number of employees The costs associated with 2 jobs carried out during the month were as follows: Job Smith Job Brown Direct Materials 17.80 19.90 Direct Labour Hours 4 @ 4.50 7 @ 5.00 Overheads - Binding 1 labour hr 2 labour hrs Overheads - Packing 1 mach hr 1 mach hr The profit mark-up on each job is 10% on total cost. INSTRUCTIONS 1 Load spreadsheet APQ05T1 into your computer and enter your name in cell E1. 2 Using the data above, complete the spreadsheet by entering the appropriate (a) data into all cells marked with a d; (b) formulae into all cells marked with an f. 3 Save your amended spreadsheet as APQ05T1S. 4 Print your completed spreadsheet. 5 Complete the Formulae Worksheet (Question 5 - Task 1) by writing down the appropriate formulae from your spreadsheet. Cost Elements./Systems: Overhead Apportionment 17
Accounting and Finance: Management Accounting - Overhead Apportionment -Int 2/Higher Greenend plc wants to be sure that its system of allocating and apportioning overheads results in the lowest possible prices to customers. With this in mind the Management Accountant has decided to make the following changes to the present system. EXERCISE 5 - TASK 2 Read carefully the data below and then carry out the instructions which follow. DATA (a) Rates to be allocated as Binding 1,013; Packing 924; Warehouse 521 and Office 200. (b) Light and Heat is 800 and Factory Insurance 1,000. (c) Machine hours are changed to Binding 300 and Packing 400. (d) The cost of materials for Job Smith is 20.30 and the direct labour for Job Brown is 8 hours @ 6.00. INSTRUCTIONS 1 Load the amended spreadsheet APQ05T1S into your computer. 2 Using the data above, complete the spreadsheet by entering the appropriate data and formulae. 3 Save your amended spreadsheet as APQ05T2S. 4 Print your completed spreadsheet. Cost Elements./Systems: Overhead Apportionment 18
Accounting and Finance: Management Accounting - Overhead Apportionment - Int 2/Higher Q5 TASK 1 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 GREENEND plc (a) Basis of Apportionment A B C D E F Student Name Apportionment Data Production Production Service Dept Service TOTAL Binding Packing Warehouse Office Floor Area 40% 50% 5% 5% 100% Number of Employees 40 60 10 20 130 Value of Fixed Assets 15,000 25,000 10,000 5,000 55,000 Machine Hours per Department 250 250 Labour Hours per Department 160 200 (b) Apportionment Overhead Allocated Rates 2,030 Productive Wages 13,000 Repairs to Equipment 330 Light and Heat 500 Factory Insurance 900 Overhead Analysis Production Production Service Dept Service Method of Binding Packing Warehouse Office Apportionment Allocated Rates d d d d f Productive Wages f f f f f Repairs to Equipment f f f f f Light and Heat f f f f f Factory Insurance f f f f f Departmental Total f f f f Service Department - Office f f f f Departmental Total f f f Service Department - Warehouse f f f Total Overheads f f Overhead Asorption Production Production Binding Packing Machine Rate per Hour f f Labour Rate per Hour f f Job Costing Job Smith Job Brown Materials d d Labour f f Overheads - Binding f f Overheads - Packing f f Total Cost f f Add: Profit f f Selling Price f f APQ05T1.XLS 19
Accounting and Finance: Management Accounting - Overhead Apportionment - Int 2/Higher Formulae Worksheet (Question 5 - Task 1) Complete this worksheet with the appropriate formula for each spreadsheet cell as indicated. Item Cell Formula Allocated Rates (Method of Apportionment) F28... Productive Wages (Binding Dept) B29... Repairs to Equipment (Packing Dept) C30... Light and Heat (Warehouse) D31... Factory Insurance (Office) E32... Departmental Total (Binding Dept) B33... Machine Rate per Hour (Packing Dept) C43... Labour (Job Smith) B50... Overheads - Binding (Job Brown) C51... Overheads - Packing (Job Smith) B52... Total Cost (Job Brown) C53... Profit (Job Smith) B54... Selling Price (Job Brown) C55... Cost Elements/Systems: Overhead Apportionment 20
Accounting and Finance: Management Accounting - Overhead Apportionment - Int 2/Higher Hardcourt Brothers has decided to use a spreadsheet to perform 2 tasks. Task 1 is to use an existing spreadsheet as a basis of apportioning overhead costs to Production and Service Departments. Task 2 is to amend the spreadsheet formulae/data in response to a range of "what if" situations. EXERCISE 6 - TASK 1 Read carefully the data below and then carry out the instructions which follow. DATA (a) (b) Overhead costs have to be apportioned to the Production Departments using an appropriate basis. Wages are to be allocated as shown: Production Department - Turning 5,240 Production Department - Assembly 6,160 Service Department - Warehouse 1,976 Service Department - Office 6,756 (c) (d) Overhead costs of the Service Departments have to be apportioned to the Production Departments on the basis of: Office: Floor area Warehouse: Number of employees The costs associated with 2 jobs carried out during the month were as follows: Job 55 Job 70 Direct Materials 300.50 160.40 Direct Labour Hours 2 @ 6.50 17 @ 6.00 Overheads - Turning 1 labour hr 3 labour hrs 1 mach hr 3 mach hrs Overheads - Assembly 2 labour hrs 1 labour hr 1 mach hr 2 mach hrs (e) The profit mark-up on Job 55 is 20% on total cost and the mark-up on Job 70 is 10% on total cost. INSTRUCTIONS 1 Load spreadsheet APQ06T1 into your computer and enter your name in cell E1. 2 Using the data above, complete the spreadsheet by entering the appropriate (a) data into all cells marked with a d; (b) formulae into all cells marked with an f. 3 Save your amended spreadsheet as APQ06T1S. 4 Print your completed spreadsheet. 5 Complete the Formulae Worksheet (Question 6 - Task 1) by writing down the appropriate formulae from your spreadsheet. Cost Elements/Systems: Overhead Apportionment 21
Accounting and Finance: Management Accounting - Overhead Apportionment - Int 2/Higher Hardcourt Brothers wants to be sure that its system of allocating and apportioning overheads results in the lowest possible prices to customers. With this in mind the Management Accountant has decided to make the following changes to the present system. EXERCISE 6 - TASK 2 Read carefully the data below and then carry out the instructions which follow. DATA (a) (b) The overhead charge from Assembly to Job 55 is 3 labour hours and 2 machine hours. Overhead costs of the Warehouse have to be apportioned to the Production Departments on the basis of floor area. INSTRUCTIONS 1 Load the amended spreadsheet APQ06T1S into your computer. 2 Using the data above, complete the spreadsheet by entering the appropriate data and formulae. 3 Save your amended spreadsheet as APQ06T2S. 4 Print your completed spreadsheet. 5 Complete the Formulae Worksheet (Question 6 - Task 2) by writing down the appropriate formulae from your spreadsheet. Cost Elements/Systems: Overhead Apportionment 22
Accounting and Finance: Management Accounting - Overhead Apportionment - Int 2/Higher Q6 TASK 1 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 A B C D E F HARDCOURT Bros Student Name (a) Basis of Apportionment Apportionment Data Production Production Service Dept Service TOTAL Turning Assembly Warehouse Office Floor Area 60% 20% 10% 10% 100% Number of Employees 10 60 10 20 100 Value of Fixed Assets 50,000 10,000 6,000 4,000 70,000 Machine Hours per Department 500 200 Labour Hours per Department 400 80 (b) Apportionment Overhead Allocated Wages 20,132 Power 35,000 Repairs to Equipment 1,400 Light and Heat 1,000 Rent and Rates 1,000 Overhead Analysis Production Production Service Dept Service Method of Turning Assembly Warehouse Office Apportionment Allocated Wages d d d d f Power f f f f f Repairs to Equipment f f f f f Light and Heat f f f f f Rent and Rates f f f f f Departmental Total f f f f Service Department - Office f f f f Departmental Total f f f Service Department - Warehouse f f f Total Overheads f f Overhead Asorption Production Production Turning Assembly Machine Rate per Hour f f Labour Rate per Hour f f Job Costing Job 55 Job 70 Materials d d Labour f f Overheads - Turning f f Overheads - Assembly f f Total Cost f f Add: Profit f f Selling Price f f APQ06T1.XLS 23
Accounting and Finance: Management Accounting - Overhead Apportionment - Int 2/Higher Formulae Worksheet (Question 6 - Task 1) Complete this worksheet with the appropriate formula for each spreadsheet cell as indicated. Item Cell Formula Allocated Wages (Method of Apportionment) F28... Power (Turning Dept) B29... Repairs to Equipment (Assembly Dept) C30... Light and Heat (Warehouse) D31... Rent and Rates (Office) E32... Departmental Total (Turning Dept) B33... Machine Rate per Hour (Assembly Dept) C43... Labour (Job 55) B50... Overheads - Assembly (Job 70) C51... Overheads - Turning (Job 55) B52... Total Cost (Job 70) C53... Profit (Job 55) B54... Selling Price (Job 70) C55... Cost Elements/Systems: Overhead Apportionment 24
Accounting and Finance: Management Accounting - Overhead Apportionment - Int 2/Higher Formulae Worksheet (Question 6 - Task 2) Complete this worksheet with the appropriate formula for each spreadsheet cell as indicated. Item Cell Formula Service Dept - Warehouse (Turning Dept) B36... Service Dept - Warehouse (Assembly Dept) C36... Overheads - Assembly (Job 55) B52... Cost Elements/Systems: Overhead Apportionment 25
Accounting and Finance: Management Accounting - Overhead Apportioning - Higher Kat-Kit plc has decided to use a spreadsheet to perform 2 tasks. Task 1 is to use an existing spreadsheet as a basis of apportioning overhead costs to Production and Service Departments. Task 2 is to amend the spreadsheet formulae/data in response to a range of "what if" situations. EXERCISE 7 - TASK 1 Read carefully the data below and then carry out the instructions which follow. DATA (a) (b) (c) (d) (e) Overhead costs have to be apportioned to the Production Departments using an appropriate basis. Expenses and Insurance are to be allocated as shown: Expenses Insurance Production Department A 40 20 Production Department B 50 90 Production Department C 60 72 Production Department D 84 50 Production Department E 12 30 Service Department - Canteen 29 28 Service Department - Personnel 46 22 Overhead costs of the Service Departments have to be apportioned to the Production Departments on the basis of: Personnel: Number of employees Canteen: Floor area The costs associated with 5 jobs carried out during the month were as follows: Job 123 Job 245 Job 456 Job 874 Job 913 Direct Materials 14.80 3.90 9.20 12.00 18.90 Direct Labour Hours 6 @ 4.10 9 @ 5.24 8 @ 8.20 12 @ 10 2 @ 3.10 Overheads - Dept A 1 labour hr 1 labour hr 2 labour hrs 2 mach hrs 1 mach hr Overheads - Dept B 2 mach hrs 1 mach hr 1 labour hr 3 labour hrs 1 mach hr Overheads - Dept C 1 labour hr 1 labour hr 1 labour hr 2 labour hrs 3 mach hrs Overheads - Dept D 1 labour hr 1 labour hr 3 labour hrs 1 labour hr 4 mach hrs Overheads - Dept E 1 labour hr 1 labour hr 2 labour hrs 3 mach hrs 2 labour hrs The profit mark-up on all jobs is 10% on total cost. INSTRUCTIONS 1 Load spreadsheet APQ07T1 into your computer and enter your name in cell H1. 2 Using the data above, complete the spreadsheet by entering the appropriate (a) data into all cells marked with a d; (b) formulae into all cells marked with an f. 3 Save your amended spreadsheet as APQ07T1S. 4 Print your completed spreadsheet. 5 Complete the Formulae Worksheet (Question 7 - Task 1) by writing down the appropriate formulae from your spreadsheet. Cost Elements/Systems: Overhead Apportionment 26
Accounting and Finance: Management Accounting - Overhead Apportioning - Higher Kat-Kit plc wants to be sure that its system of allocating and apportioning overheads results in the lowest possible prices to customers. With this in mind the Management Accountant has decided to make the following changes to the present system. EXERCISE 7 - TASK 2 Read carefully the data below and then carry out the instructions which follow. DATA (a) Expenses are to be allocated as Department A 50; Department B 100; Department C 80; Department D 90; Department E 20; Canteen 72 and Personnel 88. (b) Rent and Rates are 5,600 and Indirect Wages 800. (c) Labour hours are changed to Department A 900; Department C 200 and Department E 140. (d) Machine hours are changed to Department A 500; Department C 600 and Department E 650. (e) Light and Heat is to be apportioned on the basis of number of employees and Personnel Department overheads are to be apportioned according to Floor Area. (f) Employee numbers have been altered to Department A 20; Department B 40; Department C 25; Department D 50; Department E 15; Canteen 40 and Personnel 10. (g) The following changes have been made to the 5 jobs: Job 132: Job 245: Job 456: Job 874: Job 913: Direct materials are 16.70; Overhead charge to Department A is 2 labour hours; Overhead charge to Department E is 2 labour hours Direct labour is 10 hours at 5.50; Overhead charge to Department B is 2 machine hours; Overhead charge to Department C is 2 labour hours Overhead charge to Department B is 2 labour hours; Overhead charge to Department E is 3 labour hours Direct materials are 16.00; Overhead charge to Department B is 1 machine hour; Overhead charge to Department E is 1 machine hour Direct labour is 3 hours at 4.00; Overhead charge to Department C is 1 machine hour; Overhead charge to Department D is 1 machine hour INSTRUCTIONS 1 Load the amended spreadsheet APQ07T1S into your computer. 2 Using the data above, complete the spreadsheet by entering the appropriate data and formulae. 3 Save your amended spreadsheet as APQ07T2S. 4 Print your completed spreadsheet. 5 Complete the Formulae Worksheet (Question 7 - Task 2) by writing down the appropriate formulae from your spreadsheet. Cost Elements/Systems: Overhead Apportionment 27
Accounting and Finance: Management Accounting - Overhead Apportionment - Int 2/Higher Q7 TASK 1 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 62 KAT-KIT plc (a) Basis of Apportionment A B C D E F G H I Student Name Apportionment Data Production Service TOTAL Dept A Dept B Dept C Dept D Dept E Canteen Personnel Floor Area 20% 15% 25% 5% 10% 15% 10% 100% Number of Employees 12 30 24 48 6 36 4 160 Value of Fixed Assets 40,000 20,000 10,000 10,000 5,000 10,000 5,000 100,000 Labour Hours per Department 854.0 246.5 117.4 533.2 118.0 Machine Hours per Department 488.0 493.0 587.0 666.5 47.2 (b) Apportionment Overhead Allocated Expenses 321 Allocated Insurance 312 Light and Heat 2,000 Depreciation of Machinery 3,000 Rent and Rates 4,800 Repairs to Equipment 600 Indirect Wages 320 Overhead Analysis Production Service Method of Dept A Dept B Dept C Dept D Dept E Canteen Personnel Apportionment Allocated Expenses d d d d d d d f Allocated Insurance d d d d d d d f Light and Heat f f f f f f f f Depreciation of Machinery f f f f f f f f Rent and Rates f f f f f f f f Repairs to Equipment f f f f f f f f Indirect Wages f f f f f f f f Departmental Total f f f f f f f Service Department - Personnel f f f f f f f Departmental Total f f f f f f Service Department - Canteen f f f f f f Total Overheads f f f f f Overhead Asorption Production Dept A Dept B Dept C Dept D Dept E Labour Rate per Hour f f f f f Machine Rate per Hour f f f f f Job Costing Job 132 Job 245 Job 456 Job 874 Job 913 Materials d d d d d Labour f f f f f Overheads - Dept A f f f f f Overheads - Dept B f f f f f Overheads - Dept C f f f f f Overheads - Dept D f f f f f Overheads - Dept E f f f f f Total Cost f f f f f Add: Profit f f f f f Selling Price f f f f f APQ07T1.XLS 28
Accounting and Finance: Management Accounting - Overhead Apportionment - Higher Formulae Worksheet (Question 7 - Task 1) Complete this worksheet with the appropriate formula for each spreadsheet cell as indicated. Item Cell Formula Allocated Expenses (Method of Apportionment) I30... Light and Heat (Dept A) B32... Depreciation of Machinery (Dept B) C33... Departmental Total (Dept C) D37... Service Department - Personnel (Dept D) E38... Service Department - Canteen (Dept E) F40... Machine Rate per Hour (Dept C) D48... Labour (Job 245) C54... Overheads - Dept D (Job 456) D58... Overheads - Dept E (Job 245) C59... Total Cost (Job 456) D60... Profit (Job 874) E61... Selling Price (Job 913) F62... Cost Elements/Systems: Overhead Apportionment 29
Accounting and Finance: Management Accounting - Overhead Apportionment - Higher Formulae Worksheet (Question 7 - Task 2) Complete this worksheet with the appropriate formula for each spreadsheet cell as indicated. Item Cell Formula Light and Heat (Dept A) B32... Light and Heat (Method of Apportionment) I32... Service Department - Personnel (Dept C) D38... Labour (Job 245) C54... Overheads - Dept A (Job 132) B55... Overheads - Dept E (Job 456) D59... Cost Elements/Systems: Overhead Apportionment 30
Accounting and Finance: Management Accounting - Overhead Apportionment - Higher Lawson Laundries has decided to use a spreadsheet to perform 2 tasks. Task 1 is to use an existing spreadsheet as a basis of apportioning overhead costs to Production and Service Departments. Task 2 is to amend the spreadsheet formulae/data in response to a range of "what if" situations. EXERCISE 8 - TASK 1 Read carefully the data below and then carry out the instructions which follow. DATA (a) (b) (c) (d) (e) Overhead costs have to be apportioned to the Production Departments using an appropriate basis. Expenses and Power are to be allocated as shown: Expenses Power Production Department 1 60 2,000 Production Department 2 60 2,000 Production Department 3 80 2,000 Production Department 4 80 2,000 Production Department 5 120 2,000 Service Department - Office 120 110 Service Department - Warehouse 120 750 Overhead costs of the Service Departments have to be apportioned to the Production Departments on the basis of: Warehouse: Number of employees Office: Floor area The costs associated with 5 jobs carried out during the month were as follows: Job 1 Job 2 Job 3 Job 4 Job 5 Direct Materials 13.80 33.90 45.60 32.80 34.20 Direct Labour Hours 6 @ 4.10 9 @ 5.24 10 @ 4.20 2 @ 4.50 1 @ 9.00 Overheads - Dept 1 1 labour hr 1 labour hr 2 mach hrs 1 mach hr 2 labour hrs Overheads - Dept 2 2 mach hrs 1 mach hr 2 labour hrs 1 labour hr 3 mach hrs Overheads - Dept 3 1 labour hr 1 labour hr 2 mach hrs 1 labour hr 2 labour hrs Overheads - Dept 4 1 labour hr 1 labour hr 1 mach hr 2 labour hrs 1 mach hr Overheads - Dept 5 1 labour hr 1 labour hr 1 mach hr 1 mach hr 2 labour hrs The profit mark-up on all jobs is 12% on total cost. INSTRUCTIONS 1 Load spreadsheet APQ08T1 into your computer and enter your name in cell H1. 2 Using the data above, complete the spreadsheet by entering the appropriate (a) data into all cells marked with a d; (b) formulae into all cells marked with an f. 3 Save your amended spreadsheet as APQ08T1S. 4 Print your completed spreadsheet. 5 Complete the Formulae Worksheet (Question 8 - Task 1) by writing down the appropriate formulae from your spreadsheet. Cost Elements/Systems: Overhead Apportionment 31
Accounting and Finance: Management Accounting - Overhead Apportionment - Higher Lawson Laundries wants to be sure that its system of allocating and apportioning overheads results in the lowest possible prices to customers. With this in mind the Management Accountant has decided to make the following changes to the present system. EXERCISE 8 - TASK 2 Read carefully the data below and then carry out the instructions which follow. DATA (a) Power is to be allocated as Department 1 2,500; Department 2 2,500; Department 3 1,000; Department 4 2,000; Department 5 3,000; Office 1,258 and Warehouse 1,930. (b) Light and Heat is to be 3,000 and Factory Insurance 7,000. (c) (d) (e) Labour hours are changed to Department 1 500; Department 2 100; Department 3 250; Department 4 200 and Department 5 450. Machine hours are changed to Department 1 150; Department 2 150 and Department 3 200; Department 4 100 and Department 5 100. Factory Insurance is to be apportioned on the basis of value of fixed assets and Office overheads are to be apportioned according to number of employees. (f) Floor areas have been altered to Department 1 15%; Department 2 10%; Department 3 20%; Department 4 20%; Department 5 15%; Office 10% and Warehouse 10%. (g) The following changes have been made to the 5 jobs: Job 1: Job 2: Job 3: Job 4: Job 5: Direct materials are 14.80; Overhead charge to Department 3 is 2 labour hours; Overhead charge to Department 4 is 2 labour hours Direct labour is 10 hours at 4.50; Overhead charge to Department 1 is 1 machine hour; Overhead charge to Department 4 is 2 labour hours Overhead charge to Department 3 is 1 labour hour; Overhead charge to Department 5 is 1 labour hour Direct materials are 33.50; Overhead charge to Department 1 is 2 machine hours; Overhead charge to Department 2 is 1 machine hour Direct labour is 4 hours at 4.80; Overhead charge to Department 2 is 1 machine hour; Overhead charge to Department 4 is 2 machine hours INSTRUCTIONS 1 Load the amended spreadsheet APQ08T1S into your computer. 2 Using the data above, complete the spreadsheet by entering the appropriate data and formulae. 3 Save your amended spreadsheet as APQ08T2S. 4 Print your completed spreadsheet. 5 Complete the Formulae Worksheet (Question 8 - Task 2) by writing down the appropriate formulae from your spreadsheet. Cost Elements/Systems: Overhead Apportionment 32
Accounting and Finance - Management Accounting - Overhead Apportionment - Higher Q8 TASK 1 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 62 A B C D E F G H I LAWSON LAUNDRIES Student Name (a) Basis of Apportionment Apportionment Data Production Service TOTAL Dept 1 Dept 2 Dept 3 Dept 4 Dept 5 Office Warehouse Floor Area 20% 20% 10% 10% 20% 10% 10% 100% Number of Employees 40 100 20 40 30 20 30 280 Value of Fixed Assets 3,000 10,000 26,000 9,000 12,000 5,000 5,000 70,000 Labour Hours per Department 300 200 200 300 400 Machine Hours per Department 300 100 100 70 80 (b) Apportionment Overhead Allocated Expenses 640 Allocated Power 10,860 Light and Heat 2,000 Depreciation of Machinery 14,000 Factory Insurance 4,800 Repairs to Equipment 700 Salaries 42,000 Overhead Analysis Production Service Method of Dept 1 Dept 2 Dept 3 Dept 4 Dept 5 Office Warehouse Apportionment Allocated Expenses d d d d d d d f Allocated Power d d d d d d d f Light and Heat f f f f f f f f Depreciation of Machinery f f f f f f f f Factory Insurance f f f f f f f f Repairs to Equipment f f f f f f f f Salaries f f f f f f f f Departmental Total f f f f f f f Service Department - Warehouse f f f f f f f Departmental Total f f f f f f Service Department - Office f f f f f f Total Overheads f f f f f Overhead Asorption Production Dept 1 Dept 2 Dept 3 Dept 4 Dept 5 Labour Rate per Hour f f f f f Machine Rate per Hour f f f f f Job Costing Job 1 Job 2 Job 3 Job 4 Job 5 Materials d d d d d Labour f f f f f Overheads - Dept 1 f f f f f Overheads - Dept 2 f f f f f Overheads - Dept 3 f f f f f Overheads - Dept 4 f f f f f Overheads - Dept 5 f f f f f Total Cost f f f f f Add: Profit f f f f f Selling Price f f f f f APQ08T1.XLS 33
Accounting and Finance: Management Accounting - Overhead Apportionment - Higher Formulae Worksheet (Question 8 - Task 1) Complete this worksheet with the appropriate formula for each spreadsheet cell as indicated. Item Cell Formula Allocated Power (Method of Apportionment) I31... Light and Heat (Dept 1) B32... Depreciation of Machinery (Dept 2) C33... Factory Insurance (Dept 3) D34... Repairs to Equipment (Dept 4) E35... Salaries (Dept 5) F36... Departmental Total (Dept 1) B37... Service Department - Warehouse (Dept 2) C38... Service Department - Office (Dept 3) D40... Labour Rate per Hour (Dept 4) E47... Machine Rate per Hour (Dept 5) F48... Overheads - Dept 1 (Job 1) B56... Add: Profit (Job 2) C61... Cost Elements/Systems: Overhead Apportionment 34
Accounting and Finance: Management Accounting - Overhead Apportionment - Higher Formulae Worksheet (Question 8 - Task 2) Complete this worksheet with the appropriate formula for each spreadsheet cell as indicated. Item Cell Formula Factory Insurance (Dept 1) B34... Service Department - Office (Dept 2) C40... Labour (Job 5) F54... Overheads - Dept 3 (Job 1) B57... Overheads - Dept 4 (Job 5) F58... Overheads - Dept 5 (Job 3) D59... Cost Elements/Systems: Overhead Apportionment 35
Accounting and Finance: Management Accounting - Overhead Apportionment - Higher Manor Textiles has decided to use a spreadsheet to perform 2 tasks. Task 1 is to use an existing spreadsheet as a basis of apportioning overhead costs to Production and Service Departments. Task 2 is to amend the spreadsheet formulae/data in response to a range of "what if" situations. EXERCISE 9 - TASK 1 Read carefully the data below and then carry out the instructions which follow. DATA (a) (b) (c) (d) (e) Overhead costs have to be apportioned to the Production Departments using an appropriate basis. Materials and Insurance are to be allocated as shown: Materials Insurance Spinning 70 150 Weaving 70 150 Binding 70 140 Assembly 70 68 Packing 70 99 Service Department - Office 76 65 Service Department - Canteen 50 88 Overhead costs of the Service Departments have to be apportioned to the Production Departments on the basis of: Canteen: Floor area Office: Value of fixed assets The costs associated with 5 jobs carried out during the month were as follows: Job Dundee Job Clyde Job Perth Job Ayr Job Inverness Direct Materials 10.80 9.70 2.70 19.45 6.80 Direct Labour Hours 6 @ 4.00 9 @ 5.00 2 @ 8.00 4 @ 6.00 4 @ 2.00 Overheads - Spinning 2 labour hrs 1 labour hr 1 mach hr 2 mach hrs 1 mach hr Overheads - Weaving 1 mach hr 2 mach hrs 1 labour hr 2 labour hrs 3 labour hrs Overheads - Binding 2 labour hrs 1 labour hr 4 mach hrs 1 mach hr 1 labour hr Overheads - Assembly 3 labour hrs 2 labour hrs 2 mach hrs 1 mach hr 1 labour hr Overheads - Packing 1 labour hr 1 labour hr 1 mach hr 4 labour hrs 1 mach hr The profit mark-up on all jobs is 8% on total cost. INSTRUCTIONS 1 Load spreadsheet APQ09T1 into your computer and enter your name in cell H1.. 2 Using the data above, complete the spreadsheet by entering the appropriate (a) data into all cells marked with a d; (b) formulae into all cells marked with an f. 3 Save your amended spreadsheet as APQ09T1S. 4 Print your completed spreadsheet. 5 Complete the Formulae Worksheet (Question 9 - Task 1) by writing down the appropriate formulae from your spreadsheet. Cost Elements/Systems: Overhead Apportionment 36
Accounting and Finance: Management Accounting - Overhead Apportionment - Higher Manor Textiles wants to be sure that its system of allocating and apportioning overheads results in the lowest possible prices to customers. With this in mind the Management Accountant has decided to make the following changes to the present system. EXERCISE 9 - TASK 2 Read carefully the data below and then carry out the instructions which follow. DATA (a) Materials to be allocated as Spinning 100; Weaving 120; Binding 100; Assembly 80; Packing 120; Office 84 and Canteen 118. Insurance allocated to the Canteen should be 107. (b) The floor area measurements should read Spinning 300 sq m; Weaving 400 sq m; Binding 200 sqm; Assembly 150 sq m; Packing 150 sq m; Office 150 sq m and Canteen 150 sq m. (c) Labour hours are changed to Spinning 70; Weaving 50 and Packing 50. (d) Machine hours are changed to Spinning 200; Weaving 300; Binding 250; Assembly 250 and Packing 300. (e) Power is 4,000 and Repairs to Equipment 560. (f) (g) Both the Office and Canteen overheads are to be apportioned according to number of employees. The following changes have been made to the 5 jobs: Job Dundee: Job Clyde: Job Perth: Job Ayr: Direct materials are 17.80; Overhead charge to Weaving is 1 labour hour; Overhead charge to Packing is 2 labour hours Direct labour is 2 hours at 6.50; Overhead charge to Spinning is 1 machine hour; Overhead charge to Binding is 2 labour hours Overhead charge to Weaving is 2 labour hours; Overhead charge to Packing is 1 labour hour Direct materials are 18.50; Overhead charge to Assembly is 2 machine hours; Overhead charge to Packing is 1 labour hour Job Inverness: Direct labour is 6 hours at 9.80; Overhead charge to Weaving is 1 labour hour; Overhead charge to Packing is 2 machine hours INSTRUCTIONS 1 Load the amended spreadsheet APQ09T1S into your computer. 2 Using the data above, complete the spreadsheet by entering the appropriate data and formulae. 3 Save your amended spreadsheet as APQ09T2S. 4 Print your completed spreadsheet. 5 Complete the Formulae Worksheet (Question 9 - Task 2) by writing down the appropriate formulae from your spreadsheet. Cost Elements/Systems: Overhead Apportionment 37
Accounting and Finance - Management Accounting - Overhead Apportionment - Higher Q9 TASK 1 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 62 A B C D E F G H I MANOR TEXTILES plc Student Name (a) Basis of Apportionment Apportionment Data Production Service TOTAL Spinning Weaving Binding Assembly Packing Office Canteen Floor Area (sq m) 200 300 100 100 200 100 200 1,200 Number of Employees 20 30 10 20 5 30 5 120 Value of Fixed Assets 20,000 40,000 10,000 2,000 1,000 5,000 2,000 80,000 Labour Hours per Department 68 48 40 20 44 Machine Hours per Department 160 280 230 230 260 (b) Apportionment Overhead Allocated Materials 476 Allocated Insurance 760 Power 2,000 Light and Heat 720 Depreciation of Machinery 800 Rent and Rates 1,440 Repairs to Equipment 480 Overhead Analysis Production Service Method of Spinning Weaving Binding Assembly Packing Office Canteen Apportionment Allocated Materials d d d d d d d f Allocated Insurance d d d d d d d f Power f f f f f f f f Light and Heat f f f f f f f f Depreciation of Machinery f f f f f f f f Rent and Rates f f f f f f f f Repairs to Equipment f f f f f f f f Departmental Total f f f f f f f Service Department - Canteen f f f f f f f Departmental Total f f f f f f Service Department - Office f f f f f f Total Overheads f f f f f Overhead Asorption Production Spinning Weaving Binding Assembly Packing Labour Rate per Hour f f f f f Machine Rate per Hour f f f f f Job Costing Dundee Clyde Perth Ayr Inverness Materials d d d d d Labour f f f f f Overheads - Spinning f f f f f Overheads - Weaving f f f f f Overheads - Binding f f f f f Overheads - Assembly f f f f f Overheads - Packing f f f f f Total Cost f f f f f Add: Profit f f f f f Selling Price f f f f f APQ09T1.XLS 38
Accounting and Finance: Management Accounting - Overhead Apportionment - Higher Formulae Worksheet (Question 9 - Task 1) Complete this worksheet with the appropriate formula for each spreadsheet cell as indicated. Item Cell Formula Allocated Materials (Method of Apportionment) I30... Power (Spinning) B32... Light and Heat (Weaving) C33... Depreciation of Machinery (Binding) D34... Rent and Rates (Assembly) E35... Repairs to Equipment (Packing) F36... Departmental Total (Spinning) B37... Service Department - Office (Weaving) C38... Service Department - Canteen (Binding) D40..... Labour Rate per Hour (Assembly) E47... Machine Rate per Hour (Packing) F48... Overheads - Weaving (Dundee) B56... Add: Profit (Clyde) C61... Cost Elements/Systems: Overhead Apportionment 39
Accounting and Finance: Management Accounting - Overhead Apportionment - Higher Formulae Worksheet (Question 9 - Task 2) Complete this worksheet with the appropriate formula for each spreadsheet cell as indicated. Item Cell Formula Allocated Materials (Spinning) B18... Allocated Insurance (Spinning) B19... Service Dept - Office (Spinning) B38... Service Dept - Canteen (Method of Apportionment) I40... Overheads - Spinning (Inverness) F54... Overheads - Packing (Inverness) F59... Cost Elements/Systems: Overhead Apportionment 40
ACCOUNTING AND FINANCE MANAGEMENT ACCOUNTING INTERMEDIATE 2/HIGHER COMPUTER-BASED EXEMPLARS OVERHEAD APPORTIONMENT SOLUTIONS Accounting and Finance - Management Accounting - Overhead Apportionment Solutions - Int 2/Higher
Accounting and Finance - Management Accounting - Overhead Apportionment - Int 2/Higher
Accounting and Finance - Management Accounting - Overhead Apportionment Solutions - Int 2 Q1 TASK 1 FORMULAE 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 A B C D E ABERCORN MANUFACTURING Student Name (a) Basis of Apportionment Apportionment Data Production Production Service TOTAL Dept A Dept B Dept Floor Area 0.3 0.2 0.5 =SUM(B8:D8) Number of Employees 10 8 12 =SUM(B9:D9) Value of Fixed Assets 30000 10000 20000 =SUM(B10:D10) (b) Apportionment Overhead Light and Heat 280 Depreciation of Machinery 240 Rent and Rates 700 Repairs to Equipment 1350 Indirect Materials 300 Indirect Wages 750 Overhead Analysis Production Production Service Method of Dept A Dept B Dept Apportionment Light and Heat =B17*B8 =B17*C8 =B17/E8*D8 =A8 Depreciation of Machinery =B18/E10*B10 =B18/E10*C10 =B18/E10*D10 =A10 Rent and Rates =B19*B8 =B19*C8 =B19/E8*D8 =A8 Repairs to Equipment =B20/E10*B10 =B20/E10*C10 =B20/E10*D10 =A10 Indirect Materials =B21/E9*B9 =B21/E9*C9 =B21/E9*D9 =A9 Indirect Wages =B22/E9*B9 =B22/E9*C9 =B22/E9*D9 =A9 Departmental Total =SUM(B27:B32) =SUM(C27:C32) =SUM(D27:D32) Service Department =D33/(B9+C9)*B9 =D33/(B9+C9)*C9 =A9 Total Overheads =B33+B34 =C33+C34 APQ01T1F.XLS 43
Accounting and Finance - Management Accounting - Overhead Apportionment Solutions - Int 2 Q1 TASK 1 SOLUTION 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 A B C D E F ABERCORN MANUFACTURING Student Name (a) Basis of Apportionment Apportionment Data Production Production Service TOTAL Dept A Dept B Dept Floor Area 30% 20% 50% 100% Number of Employees 10 8 12 30 Value of Fixed Assets 30,000 10,000 20,000 60,000 (b) Apportionment Overhead Light and Heat 280 Depreciation of Machinery 240 Rent and Rates 700 Repairs to Equipment 1,350 Indirect Materials 300 Indirect Wages 750 Overhead Analysis Production Production Service Method of Dept A Dept B Dept Apportionment Light and Heat 84 56 140 Floor Area Depreciation of Machinery 120 40 80 Value of Fixed Assets Rent and Rates 210 140 350 Floor Area Repairs to Equipment 675 225 450 Value of Fixed Assets Indirect Materials 100 80 120 Number of Employees Indirect Wages 250 200 300 Number of Employees Departmental Total 1,439 741 1,440 Service Department 800 640 Number of Employees Total Overheads 2,239 1,381 APQ01T1S.XLS 44
Accounting and Finance - Management Accounting - Overhead Apportionment Solutions - Int 2 Q1 TASK 1 WORKSHEET Formulae Worksheet (Question 1 - Task 1) Complete this worksheet with the appropriate formula for each spreadsheet cell as indicated. Item Cell Formula Light and Heat (Dept A) B27 =B17*B8 Depreciation of Machinery (Dept B) C28 =B18/E10*C10 Rent and Rates (Service Dept) D29 =B19/E8*D8 Repairs to Equipment (Dept A) B30 =B20/E10*B10 Indirect Materials (Dept B) C31 =B21/E9*C9 Indirect Wages (Service Dept) D32 =B22/E9*D9 Departmental Total (Dept A) B33 =SUM(B27:B32) Service Dept (Dept B) C34 =D33/(B9+C9)*C9 Service Dept (Method of Apportionment) E34 =A9 Total Overheads (Dept A) B35 =B33+B34 Cost Elements/Systems: Overhead Apportionment 45
Accounting and Finance - Management Accounting - Overhead Apportionment Solutions - Int 2 Q1 TASK 2 CHANGES 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 A B C D E ABERCORN MANUFACTURING Student Name (a) Basis of Apportionment Apportionment Data Production Production Service TOTAL Dept A Dept B Dept Floor Area 0.6 0.1 0.3 Number of Employees Value of Fixed Assets 80000 20000 (b) Apportionment Overhead Light and Heat 290 Depreciation of Machinery =240*2 Rent and Rates Repairs to Equipment Indirect Materials Indirect Wages Overhead Analysis Production Production Service Method of Dept A Dept B Dept Apportionment Light and Heat Depreciation of Machinery Rent and Rates Repairs to Equipment Indirect Materials Indirect Wages Departmental Total Service Department =D34/(B8+C8)*B8 =D34/(B8+C8)*C8 =A8 Total Overheads APQ01T2C.XLS 46
Accounting and Finance - Management Accounting - Overhead Apportionment Solutions - Int 2 Q1 TASK 2 SOLUTION 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 A B C D E F ABERCORN MANUFACTURING Student Name (a) Basis of Apportionment Apportionment Data Production Production Service TOTAL Dept A Dept B Dept Floor Area 60% 10% 30% 100% Number of Employees 10 8 12 30 Value of Fixed Assets 80,000 20,000 20,000 120,000 (b) Apportionment Overhead Light and Heat 290 Depreciation of Machinery 480 Rent and Rates 700 Repairs to Equipment 1,350 Indirect Materials 300 Indirect Wages 750 Overhead Analysis Production Production Service Method of Dept A Dept B Dept Apportionment Light and Heat 174 29 87 Floor Area Depreciation of Machinery 320 80 80 Value of Fixed Assets Rent and Rates 420 70 210 Floor Area Repairs to Equipment 900 225 225 Value of Fixed Assets Indirect Materials 100 80 120 Number of Employees Indirect Wages 250 200 300 Number of Employees Departmental Total 2,164 684 1,022 Service Department 876 146 Floor Area Total Overheads 3,040 830 APQ01T2S.XLS 47
Accounting and Finance - Management Accounting - Overhead Apportionment Solutions - Int 2 Q1 TASK 2 WORKSHEET Formulae Worksheet (Question 1 - Task 2) Complete this worksheet with the appropriate formula for each spreadsheet cell as indicated. Item Cell Formula Service Dept (Dept A) B35 =D34/(B8+C8)*B8 Service Dept (Dept B) C35 =D34/(B8+C8)*C8 Service Dept (Method of Apportionment) E35 =A8 Cost Elements/Systems: Overhead Apportionment 48
Accounting and Finance - Management Accounting - Overhead Apportionment Solutions - Int 2 Q2 TASK 1 FORMULAE 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 A B C D E BLACKBURN plc Student Name (a) Basis of Apportionment Apportionment Data Machine Assembly Service TOTAL Shop Department Department Floor Area (sq ft) 40000 30000 10000 =SUM(B8:D8) Number of Employees 200 400 400 =SUM(B9:D9) Value of Fixed Assets 30000 10000 20000 =SUM(B10:D10) (b) Apportionment Overhead Rent 320 Repairs to Plant 600 Depreciation of Plant 468 Light and Power 320 Supervision 200 Plant Insurance 720 Overhead Analysis Machine Assembly Service Method of Shop Department Department Apportionment Rent =B17/E8*B8 =B17/E8*C8 =B17/E8*D8 =A8 Repairs to Plant =B18/E10*B10 =B18/E10*C10 =B18/E10*D10 =A10 Depreciation of Plant =B19/E10*B10 =B19/E10*C10 =B19/E10*D10 =A10 Light and Power =B20/E8*B8 =B20/E8*C8 =B20/E8*D8 =A8 Supervision =B21/E9*B9 =B21/E9*C9 =B21/E9*D9 =A9 Plant Insurance =B22/E10*B10 =B22/E10*C10 =B22/E10*D10 =A10 Departmental Total =SUM(B28:B33) =SUM(C28:C33) =SUM(D28:D33) Service Department =D34/(B9+C9)*B9 =D34/(B9+C9)*C9 =A9 Total Overheads =B34+B35 =C34+C35 APQ02T1F.XLS 49
Accounting and Finance - Management Accounting - Overhead Apportionment Solutions -Int 2 Q2 TASK 1 SOLUTION 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 A B C D E F BLACKBURN plc Student Name (a) Basis of Apportionment Apportionment Data Machine Assembly Service TOTAL Shop Department Department Floor Area (sq ft) 40,000 30,000 10,000 80,000 Number of Employees 200 400 400 1,000 Value of Fixed Assets 30,000 10,000 20,000 60,000 (b) Apportionment Overhead Rent 320 Repairs to Plant 600 Depreciation of Plant 468 Light and Power 320 Supervision 200 Plant Insurance 720 Overhead Analysis Machine Assembly Service Method of Shop Department Department Apportionment Rent 160 120 40 Floor Area (sq ft) Repairs to Plant 300 100 200 Value of Fixed Assets Depreciation of Plant 234 78 156 Value of Fixed Assets Light and Power 160 120 40 Floor Area (sq ft) Supervision 40 80 80 Number of Employees Plant Insurance 360 120 240 Value of Fixed Assets Departmental Total 1,254 618 756 Service Department 252 504 Number of Employees Total Overheads 1,506 1,122 APQ02T1S.XLS 50
Accounting and Finance - Management Accounting - Overhead Apportionment Solutions - Int 2 Q2 TASK 1 WORKSHEET Formulae Worksheet (Question 2 - Task 1) Complete this worksheet with the appropriate formula for each spreadsheet cell as indicated. Item Cell Formula Rent (Machine Shop) B28 =B17/E8*B8 Repairs to Plant (Assembly Dept) C29 =B18/E10*C10 Depreciation of Plant (Service Dept) D30 =B19/E10*D10 Light and Power (Machine Shop) B31 =B20/E8*B8 Supervision (Assembly Dept) C32 =B21/E9*C9 Plant Insurance (Service Dept) D33 =B22/E10*C10 Departmental Total (Machine Shop) B34 =SUM(B28:B33) Service Dept (Assembly Dept) C35 =D34/(B9+C9)*C9 Service Dept (Method of Apportionment) E35 =A9 Total Overheads (Machine Shop) B36 =B34+B35 Cost Elements/Systems: Overhead Apportionment 51
Accounting and Finance - Management Accounting - Overhead Apportionment Solutions - Int 2 Q2 T2 CHANGES 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 A B C D E BLACKBURN plc Student Name (a) Basis of Apportionment Apportionment Data Machine Assembly Service TOTAL Shop Department Department Floor Area (sq ft) Number of Employees 100 150 50 Value of Fixed Assets 90000 30000 30000 (b) Apportionment Overhead Rent Repairs to Plant 625 Depreciation of Plant 2000 Light and Power Supervision 210 Plant Insurance Overhead Analysis Machine Assembly Service Method of Shop Department Department Apportionment Rent Repairs to Plant Depreciation of Plant Light and Power Supervision Plant Insurance Departmental Total Service Department =D34/SUM(B10:C10)*B10 =D34/SUM(B10:C10)*C10 =A10 Total Overheads APQ02T2C.XLS 52
Accounting and Finance - Management Accounting - Overhead Apportionment Solutions - Int 2 Q2 TASK 2 SOLUTION 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 A B C D E F BLACKBURN plc Student Name (a) Basis of Apportionment Apportionment Data Machine Assembly Service TOTAL Shop Department Department Floor Area (sq ft) 40,000 30,000 10,000 80,000 Number of Employees 100 150 50 300 Value of Fixed Assets 90,000 30,000 30,000 150,000 (b) Apportionment Overhead Rent 320 Repairs to Plant 625 Depreciation of Plant 2,000 Light and Power 320 Supervision 210 Plant Insurance 720 Overhead Analysis Machine Assembly Service Method of Shop Department Department Apportionment Rent 160 120 40 Floor Area (sq ft) Repairs to Plant 375 125 125 Value of Fixed Assets Depreciation of Plant 1,200 400 400 Value of Fixed Assets Light and Power 160 120 40 Floor Area (sq ft) Supervision 70 105 35 Number of Employees Plant Insurance 432 144 144 Value of Fixed Assets Departmental Total 2,397 1,014 784 Service Department 588 196 Value of Fixed Assets Total Overheads 2,985 1,210 APQ02T2S.XLS 53
Accounting and Finance - Management Accounting - Overhead Apportionment Solutions - Int 2 Q2 TASK 2 WORKSHEET Formulae Worksheet (Question 2 - Task 2) Complete this worksheet with the appropriate formula for each spreadsheet cell as indicated. Item Cell Formula Service Dept (Machine Shop) B35 =D34/SUM(B10:C10)*B10 Service Dept (Assembly Dept) C35 =D34/SUM(B10:C10)*C10 Service Dept (Method of Apportionment) E35 =A10 Cost Elements/Systems: Overhead Apportionment 54
Accounting and Finance - Management Accounting - Overhead Apportionment Solutions - Int 2 Q3 TASK 1 FORMULAE 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 A B C D E CAMERON LTD Student Name (a) Basis of Apportionment Apportionment Data Spinning Weaving Service TOTAL Department Department Department Floor Area (sq ft) 10000 20000 5000 =SUM(B8:D8) Number of Employees 40 15 5 =SUM(B9:D9) Value of Fixed Assets 30000 10000 10000 =SUM(B10:D10) (b) Apportionment Overhead Rent and Rates 420 Indirect Materials 1200 Depreciation of Equipment 250 Light and Heat 105 Supervision 480 Administration 120 Overhead Analysis Spinning Weaving Service Method of Department Department Department Apportionment Rent and Rates =B17/E8*B8 =B17/E8*C8 =B17/E8*D8 =A8 Indirect Materials =B18/E9*B9 =B18/E9*C9 =B18/E9*D9 =A9 Depreciation of Equipment =B19/E10*B10 =B19/E10*C10 =B19/E10*D10 =A10 Light and Heat =B20/E8*B8 =B20/E8*C8 =B20/E8*D8 =A8 Supervision =B21/E9*B9 =B21/E9*C9 =B21/E9*D9 =A9 Administration =B22/E9*B9 =B22/E9*C9 =B22/E9*D9 =A9 Departmental Total =SUM(B28:B33) =SUM(C28:C33) =SUM(D28:D33) Service Department =D34/(B9+C9)*B9 =D34/(B9+C9)*C9 =A9 Total Overheads =B34+B35 =C34+C35 APQ03T1F.XLS 55
Accounting and Finance - Management Accounting - Overhead Apportionment Solutions - Int 2 Q3 TASK 1 SOLUTION 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 A B C D E F CAMERON LTD Student Name (a) Basis of Apportionment Apportionment Data Spinning Weaving Service TOTAL Department Department Department Floor Area (sq ft) 10,000 20,000 5,000 35,000 Number of Employees 40 15 5 60 Value of Fixed Assets 30,000 10,000 10,000 50,000 (b) Apportionment Overhead Rent and Rates 420 Indirect Materials 1,200 Depreciation of Equipment 250 Light and Heat 105 Supervision 480 Administration 120 Overhead Analysis Spinning Weaving Service Method of Department Department Department Apportionment Rent and Rates 120 240 60 Floor Area (sq ft) Indirect Materials 800 300 100 Number of Employees Depreciation of Equipment 150 50 50 Value of Fixed Assets Light and Heat 30 60 15 Floor Area (sq ft) Supervision 320 120 40 Number of Employees Administration 80 30 10 Number of Employees Departmental Total 1,500 800 275 Service Department 200 75 Number of Employees Total Overheads 1,700 875 APQ03T1S.XLS 56
Accounting and Finance - Management Accounting - Overhead Apportionment Solutions - Int 2 Q3 TASK 1 WORKSHEET Formulae Worksheet (Question 3 - Task 1) Complete this worksheet with the appropriate formula for each spreadsheet cell as indicated. Item Cell Formula Rent and Rates (Spinning Dept) B28 =B17/E8*B8 Indirect Materials (Weaving Dept) C29 =B18/E9*C9 Depreciation of Equipment (Service Dept) D30 =B19/E10*D10 Light and Heat (Spinning Dept) B31 =B20/E8*B8 Supervision (Weaving Dept) C32 =B21/E9*C9 Administration (Service Dept) D33 =B22/E9*C9 Departmental Total (Spinning Dept) B34 =SUM(B28:B33) Service Dept (Weaving Dept) C35 =D34/(B9+C9)*C9 Service Dept (Method of Apportionment) E35 =A9 Total Overheads (Spinning Dept) B36 =B34+B35 Cost Elements/Systems: Overhead Apportionment 57
Accounting and Finance - Managing Accounting - Overhead Apportionment Solutions - Int 2 Q3 TASK 2 CHANGES 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 A B C D E CAMERON LTD Student Name (a) Basis of Apportionment Apportionment Data Spinning Weaving Service TOTAL Department Department Department Floor Area (sq ft) 8000 16000 8000 Number of Employees Value of Fixed Assets (b) Apportionment Overhead Rent and Rates 1000 Indirect Materials Depreciation of Equipment Light and Heat 300 Supervision 300 Administration Overhead Analysis Spinning Weaving Service Method of Department Department Department Apportionment Rent and Rates Indirect Materials Depreciation of Equipment Light and Heat Supervision Administration Departmental Total Service Department =D34/SUM(B8:C8)*B8 =D34/SUM(B8:C8)*C8 =A8 Total Overheads APQ03T2C.XLS 58
Accounting and Finance - Management Accounting - Overhead Apportionment Solutions - Int 2 Q3 TASK 2 SOLUTION 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 A B C D E F CAMERON LTD Student Name (a) Basis of Apportionment Apportionment Data Spinning Weaving Service TOTAL Department Department Department Floor Area (sq ft) 8,000 16,000 8,000 32,000 Number of Employees 40 15 5 60 Value of Fixed Assets 30,000 10,000 10,000 50,000 (b) Apportionment Overhead Rent and Rates 1,000 Indirect Materials 1,200 Depreciation of Equipment 250 Light and Heat 300 Supervision 300 Administration 120 Overhead Analysis Spinning Weaving Service Method of Department Department Department Apportionment Rent and Rates 250 500 250 Floor Area (sq ft) Indirect Materials 800 300 100 Number of Employees Depreciation of Equipment 150 50 50 Value of Fixed Assets Light and Heat 75 150 75 Floor Area (sq ft) Supervision 200 75 25 Number of Employees Administration 80 30 10 Number of Employees Departmental Total 1,555 1,105 510 Service Department 170 340 Floor Area (sq ft) Total Overheads 1,725 1,445 APQ03T2S.XLS 59
Accounting and Finance - Management Accounting - Overhead Apportionment Solutions - Int 2 Q3 TASK 2 WORKSHEET Formulae Worksheet (Question 3 - Task 2) Complete this worksheet with the appropriate formula for each spreadsheet cell as indicated. Item Cell Formula Service Dept (Spinning Dept) B35 =D34/SUM(B8:C8)*B8 Service Dept (Weaving Dept) C35 =D34/SUM(B8:C8)*C8 Service Dept (Method of Apportionment) E35 =A8 Cost Elements/Systems: Overhead Apportionment 60
Accounting and Finance - Management Accounting - Overhead Apportionment Solutions - Int 2 Q4 TASK 1 FORMULAE 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 A B C D E F FERGUSON FOODS LTD Student Name (a) Basis of Apportionment Apportionment Data Production Production Service Dept Service TOTAL Dept A Dept B Canteen Office Floor Area 0.3 0.5 0.1 0.1 =SUM(B8:E8) Number of Employees 50 20 10 20 =SUM(B9:E9) Value of Fixed Assets 12000 18000 10000 6000 =SUM(B10:E10) Machine Hours per Departmen400 200 Labour Hours per Department 100 100 (b) Apportionment Overhead Allocated Depreciation 1300 Productive Wages 14200 Rent and Rates 300 Light and Heat 500 Power 920 Overhead Analysis Production Production Service Dept Service Method of Dept A Dept B Canteen Office Apportionment Allocated Depreciation 300 410 110 480 =A18 Productive Wages =B19/F9*B9 =B19/F9*C9 =B19/F9*D9 =B19/F9*E9 =A9 Rent and Rates =B20*B8 =B20*C8 =B20*D8 =B20*E8 =A8 Light and Heat =B21*B8 =B21*C8 =B21*D8 =B21*E8 =A8 Power =B22/F10*B10 =B22/F10*C10 =B22/F10*D10 =B22/F10*E10 =A10 Departmental Total =SUM(B28:B32) =SUM(C28:C32) =SUM(D28:D32) =SUM(E28:E32) Service Department - Office =E33/SUM(B9:D9)*B9 =E33/SUM(B9:D9)*C9 =E33/SUM(B9:D9)*D9 =A9 Departmental Total =B33+B34 =C33+C34 =D33+D34 Service Department - Canteen =D35/SUM(B10:C10)*B10 =D35/SUM(B10:C10)*C10 =A10 Total Overheads =B35+B36 =C35+C36 Overhead Asorption Production Production Dept A Dept B Machine Rate per Hour =B37/B11 =C37/C11 Labour Rate per Hour =B37/B12 =C37/C12 Job Costing Job X Job Y Materials 12.8 23.9 Labour =6*4.1 =9*5.24 Overheads - Department A =B44 =B44 Overheads - Department B =C43*2 =C43 Total Cost =SUM(B49:B52) =SUM(C49:C52) Add: Profit =B53*10% =C53*15% Selling Price =B53+B54 =C53+C54 APQ04T1F.XLS 61
Accounting and Finance - Management Accounting - Overhead Apportionment Solutions - Int 2 Q4 TASK 1 SOLUTION 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 A B C D E F G FERGUSON FOODS LTD Student Name (a) Basis of Apportionment Apportionment Data Production Production Service Dept Service TOTAL Dept A Dept B Canteen Office Floor Area 30% 50% 10% 10% 100% Number of Employees 50 20 10 20 100 Value of Fixed Assets 12,000 18,000 10,000 6,000 46,000 Machine Hours per Department 400 200 Labour Hours per Department 100 100 (b) Apportionment Overhead Allocated Depreciation 1,300 Productive Wages 14,200 Rent and Rates 300 Light and Heat 500 Power 920 Overhead Analysis Production Production Service Dept Service Method of Dept A Dept B Canteen Office Apportionment Allocated Depreciation 300 410 110 480 Allocated Depreciation Productive Wages 7,100 2,840 1,420 2,840 Number of Employees Rent and Rates 90 150 30 30 Floor Area Light and Heat 150 250 50 50 Floor Area Power 240 360 200 120 Value of Fixed Assets Departmental Total 7,880 4,010 1,810 3,520 Service Department - Office 2,200 880 440 Number of Employees Departmental Total 10,080 4,890 2,250 Service Department - Canteen 900 1,350 Value of Fixed Assets Total Overheads 10,980 6,240 Overhead Asorption Production Production Dept A Dept B Machine Rate per Hour 27.45 31.20 Labour Rate per Hour 109.80 62.40 Job Costing Job X Job Y Materials 12.80 23.90 Labour 24.60 47.16 Overheads - Department A 109.80 109.80 Overheads - Department B 62.40 31.20 Total Cost 209.60 212.06 Add: Profit 20.96 31.81 Selling Price 230.56 243.87 APQ04T1S.XLS 62
Accounting and Finance - Management Accounting - Overhead Apportionment Solutions - Int 2 Q4 TASK 1 WORKSHEET Formulae Worksheet (Question 4 - Task 1) Complete this worksheet with the appropriate formula for each spreadsheet cell as indicated. Item Cell Formula Allocated Depreciation (Method of Apportionment) F28 =A18 Productive Wages (Dept A) B29 =B19/F9*B9 Rent and Rates (Dept B) C30 =B20*C8 Light and Heat (Canteen) D31 =B21*D8 Power (Office) E32 =B22/F10*E10 Departmental Total (Dept A) B33 =SUM(B28:B32) Machine Rate per Hour (Dept B) C43 =C37/C11 Labour (Job X) B50 =6*4.1 Overheads - Dept A (Job Y) C51 =B44 Overheads - Dept B (Job X) B52 =C43*2 Total Cost (Job Y) C53 =SUM(C49:C52) Profit (Job X) B54 =B53*10% Selling Price (Job Y) C55 =C53+C54 Cost Elements/Systems: Overhead Apportionment 63
Accounting and Finance - Management Accounting - Overhead Apportionment Solutions - Int 2 Q4 TASK 2 CHANGES 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 FERGUSON FOODS LTD (a) Basis of Apportionment A B C D E F Student Name Apportionment Data Production Production Service Dept Service TOTAL Dept A Dept B Canteen Office Floor Area Number of Employees Value of Fixed Assets Machine Hours per Department 500 100 Labour Hours per Department 150 50 (b) Apportionment Overhead Allocated Depreciation Productive Wages Rent and Rates 500 Light and Heat Power 759 Overhead Analysis Production Production Service Dept Service Method of Dept A Dept B Canteen Office Apportionment Allocated Depreciation 1,546 753 1,500 201 Productive Wages Rent and Rates Light and Heat Power Departmental Total Service Department - Office Departmental Total Service Department - Canteen Total Overheads Overhead Asorption Production Production Dept A Dept B Machine Rate per Hour Labour Rate per Hour Job Costing Job X Job Y Materials Labour Overheads - Department A Overheads - Department B Total Cost Add: Profit Selling Price APQ04T2C.XLS 64
Accounting and Finance - Management Accounting - Overhead Apportionment Solutions - Int 2 Q4 TASK 2 SOLUTION 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 A B C D E F G FERGUSON FOODS LTD Student Name (a) Basis of Apportionment Apportionment Data Production Production Service Dept Service TOTAL Dept A Dept B Canteen Office Floor Area 30% 50% 10% 10% 100% Number of Employees 50 20 10 20 100 Value of Fixed Assets 12,000 18,000 10,000 6,000 46,000 Machine Hours per Department 500 100 Labour Hours per Department 150 50 (b) Apportionment Overhead Allocated Depreciation 4,000 Productive Wages 14,200 Rent and Rates 500 Light and Heat 500 Power 759 Overhead Analysis Production Production Service Dept Service Method of Dept A Dept B Canteen Office Apportionment Allocated Depreciation 1,546 753 1,500 201 Allocated Depreciation Productive Wages 7,100 2,840 1,420 2,840 Number of Employees Rent and Rates 150 250 50 50 Floor Area Light and Heat 150 250 50 50 Floor Area Power 198 297 165 99 Value of Fixed Assets Departmental Total 9,144 4,390 3,185 3,240 Service Department - Office 2,025 810 405 Number of Employees Departmental Total 11,169 5,200 3,590 Service Department - Canteen 1,436 2,154 Value of Fixed Assets Total Overheads 12,605 7,354 Overhead Asorption Production Production Dept A Dept B Machine Rate per Hour 25.21 73.54 Labour Rate per Hour 84.03 147.08 Job Costing Job X Job Y Materials 12.80 23.90 Labour 24.60 47.16 Overheads - Department A 84.03 84.03 Overheads - Department B 147.08 73.54 Total Cost 268.51 228.63 Add: Profit 26.85 34.30 Selling Price 295.36 262.93 APQ04T2S.XLS 65
Accounting and Finance - Management Accounting - Overhead Apportionment Solutions - Int 2 Q5 TASK 1 FORMULAE 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 GREENEND plc (a) Basis of Apportionment A B C Apportionment Data Production Production Binding Packing Floor Area 0.4 0.5 Number of Employees 40 60 Value of Fixed Assets 15000 25000 Machine Hours per Department 250 250 Labour Hours per Department 160 200 (b) Apportionment Overhead Allocated Rates 2030 Productive Wages 13000 Repairs to Equipment 330 Light and Heat 500 Factory Insurance 900 Overhead Analysis Production Production Binding Packing Allocated Rates 650 850 Productive Wages =B19/F9*B9 =B19/F9*C9 Repairs to Equipment =B20/F10*B10 =B20/F10*C10 Light and Heat =B21*B8 =B21*C8 Factory Insurance =B22*B8 =B22*C8 Departmental Total =SUM(B28:B32) =SUM(C28:C32) Service Department - Office =E33/SUM(B10:D10)*B10 =E33/SUM(B10:D10)*C10 Departmental Total =B33+B34 =C33+C34 Service Department - Warehouse =D35/SUM(B9:C9)*B9 =D35/SUM(B9:C9)*C9 Total Overheads =B35+B36 =C35+C36 Overhead Asorption Production Production Binding Packing Machine Rate per Hour =B37/B11 =C37/C11 Labour Rate per Hour =B37/B12 =C37/C12 Job Costing Job Smith Job Brown Materials 17.8 19.9 Labour =4*4.5 =7*5 Overheads - Binding =B44 =B44*2 Overheads - Packing =C43 =C43 Total Cost =SUM(B49:B52) =SUM(C49:C52) Add: Profit =B53*10% =C53*10% Selling Price =B53+B54 =C53+C54 APQ05T1F.XLS 66
Accounting and Finance - Management Accounting - Overhead Apportionment Solutions - Int 2 Q5 TASK 1 FORMULAE (continued) 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 D E F Student Name Service Dept Service TOTAL Warehouse Office 0.05 0.05 =SUM(B8:E8) 10 20 =SUM(B9:E9) 10000 5000 =SUM(B10:E10) Service Dept Service Method of Warehouse Office Apportionment 430 100 =A18 =B19/F9*D9 =B19/F9*E9 =A9 =B20/F10*D10 =B20/F10*E10 =A10 =B21*D8 =B21*E8 =A8 =B22*D8 =B22*E8 =A8 =SUM(D28:D32) =SUM(E28:E32) =E33/SUM(B10:D10)*D10 =A10 =D33+D34 =A9 APQ05T1F.XLS 67
Accounting and Finance - Management Accounting - Overhead Apportionment Solutions - Int 2 Q5 TASK 1 SOLUTION 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 A B C D E F G GREENEND plc Student Name (a) Basis of Apportionment Apportionment Data Production Production Service Dept Service TOTAL Binding Packing Warehouse Office Floor Area 40% 50% 5% 5% 100% Number of Employees 40 60 10 20 130 Value of Fixed Assets 15,000 25,000 10,000 5,000 55,000 Machine Hours per Department 250 250 Labour Hours per Department 160 200 (b) Apportionment Overhead Allocated Rates 2,030 Productive Wages 13,000 Repairs to Equipment 330 Light and Heat 500 Factory Insurance 900 Overhead Analysis Production Production Service Dept Service Method of Binding Packing Warehouse Office Apportionment Allocated Rates 650 850 430 100 Allocated Rates Productive Wages 4,000 6,000 1,000 2,000 Number of Employees Repairs to Equipment 90 150 60 30 Value of Fixed Assets Light and Heat 200 250 25 25 Floor Area Factory Insurance 360 450 45 45 Floor Area Departmental Total 5,300 7,700 1,560 2,200 Service Department - Office 660 1,100 440 Value of Fixed Assets Departmental Total 5,960 8,800 2,000 Service Department - Warehouse 800 1,200 Number of Employees Total Overheads 6,760 10,000 Overhead Asorption Production Production Binding Packing Machine Rate per Hour 27.04 40.00 Labour Rate per Hour 42.25 50.00 Job Costing Job Smith Job Brown Materials 17.80 19.90 Labour 18.00 35.00 Overheads - Binding 42.25 84.50 Overheads - Packing 40.00 40.00 Total Cost 118.05 179.40 Add: Profit 11.81 17.94 Selling Price 129.86 197.34 APQ05T1S.XLS 68
Accounting and Finance - Management Accounting - Overhead Apportionment Solutions - Int 2 Q5 TASK 1 WORKSHEET Formulae Worksheet (Question 5 - Task 1) Complete this worksheet with the appropriate formula for each spreadsheet cell as indicated. Item Cell Formula Allocated Rates (Method of Apportionment) F28 =A18 Productive Wages (Binding Dept) B29 =B19/F9*B9 Repairs to Equipment (Packing Dept) C30 =B20/F10*C10 Light and Heat (Warehouse) D31 =B21*D8 Factory Insurance (Office) E32 =B22*E8 Departmental Total (Binding Dept) B33 =SUM(B28:B32) Machine Rate per Hour (Packing Dept) C43 =C37/C11 Labour (Job Smith) B50 =4*4.5 Overheads - Binding (Job Brown) C51 =B44*2 Overheads - Packing (Job Smith) B52 =C43 Total Cost (Job Brown) C53 =SUM(C49:C52) Profit (Job Smith) B54 =B53*10% Selling Price (Job Brown) C55 =C53+C54 Cost Elements/Systems: Overhead Apportionment 69
Accounting and Finance - Management Accounting - Overhead Apportionment Solutions - Int 2 Q5 TASK 2 CHANGES 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 GREENEND plc (a) Basis of Apportionment A B C D E F Student Name Apportionment Data Production Production Service Dept Service TOTAL Binding Packing Warehouse Office Floor Area Number of Employees Value of Fixed Assets Machine Hours per Department 300 400 Labour Hours per Department (b) Apportionment Overhead Allocated Rates Productive Wages Repairs to Equipment Light and Heat 800 Factory Insurance 1,000 Overhead Analysis Production Production Service Dept Service Method of Binding Packing Warehouse Office Apportionment Allocated Rates 1,013 924 521 200 Productive Wages Repairs to Equipment Light and Heat Factory Insurance Departmental Total Service Department - Office Departmental Total Service Department - Warehouse Total Overheads Overhead Asorption Production Production Binding Packing Machine Rate per Hour Labour Rate per Hour Job Costing Job Smith Job Brown Materials 20.30 Labour =8*6 Overheads - Binding Overheads - Packing Total Cost Add: Profit Selling Price APQ05T2C.XLS 70
Accounting and Finance - Management Accounting - Overhead Apportionment Solutions - Int 2 Q5 TASK 2 SOLUTION 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 A B C D E F G GREENEND plc Student Name (a) Basis of Apportionment Apportionment Data Production Production Service Dept Service TOTAL Binding Packing Warehouse Office Floor Area 40% 50% 5% 5% 100% Number of Employees 40 60 10 20 130 Value of Fixed Assets 15,000 25,000 10,000 5,000 55,000 Machine Hours per Department 300 400 Labour Hours per Department 160 200 (b) Apportionment Overhead Allocated Rates 2,600 Productive Wages 13,000 Repairs to Equipment 330 Light and Heat 800 Factory Insurance 1,000 Overhead Analysis Production Production Service Dept Service Method of Binding Packing Warehouse Office Apportionment Allocated Rates 1,013 924 521 200 Allocated Rates Productive Wages 4,000 6,000 1,000 2,000 Number of Employees Repairs to Equipment 90 150 60 30 Value of Fixed Assets Light and Heat 320 400 40 40 Floor Area Factory Insurance 400 500 50 50 Floor Area Departmental Total 5,823 7,974 1,671 2,320 Service Department - Office 696 1,160 464 Value of Fixed Assets Departmental Total 6,519 9,134 2,135 Service Department - Warehouse 854 1,281 Number of Employees Total Overheads 7,373 10,415 Overhead Asorption Production Production Binding Packing Machine Rate per Hour 24.58 26.04 Labour Rate per Hour 46.08 52.08 Job Costing Job Smith Job Brown Materials 20.30 19.90 Labour 18.00 48.00 Overheads - Binding 46.08 92.16 Overheads - Packing 26.04 26.04 Total Cost 110.42 186.10 Add: Profit 11.04 18.61 Selling Price 121.46 204.71 APQ05T2S.XLS 71
Accounting and Finance - Management Accounting - Overhead Apportionment Solutions - Int 2 Q6 TASK 1 FORMULAE 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 A B C D E F HARDCOURT Bros Student Name (a) Basis of Apportionment Apportionment Data Production Production Service Dept Service TOTAL Turning Assembly Warehouse Office Floor Area 0.6 0.2 0.1 0.1 =SUM(B8:E8) Number of Employees 10 60 10 20 =SUM(B9:E9) Value of Fixed Assets 50000 10000 6000 4000 =SUM(B10:E10) Machine Hours per Department 500 200 Labour Hours per Department 400 80 (b) Apportionment Overhead Allocated Wages 20132 Power 35000 Repairs to Equipment 1400 Light and Heat 1000 Rent and Rates 1000 Overhead Analysis Production Production Service Dept Service Method of Turning Assembly Warehouse Office Apportionment Allocated Wages 5240 6160 1976 6756 =A18 Power =B19/F10*B10 =B19/F10*C10 =B19/F10*D10 =B19/F10*E10 =A10 Repairs to Equipment =B20/F10*B10 =B20/F10*C10 =B20/F10*D10 =B20/F10*E10 =A10 Light and Heat =B21*B8 =B21*C8 =B21*D8 =B21*E8 =A8 Rent and Rates =B22*B8 =B22*C8 =B22*D8 =B22*E8 =A8 Departmental Total =SUM(B28:B32) =SUM(C28:C32) =SUM(D28:D32) =SUM(E28:E32) Service Department - Office =E33/SUM(B8:D8)*B8 =E33/SUM(B8:D8)*C8 =E33/SUM(B8:D8)*D8 =A8 Departmental Total =B33+B34 =C33+C34 =D33+D34 Service Department - Warehouse=D35/SUM(B9:C9)*B9 =D35/SUM(B9:C9)*C9 =A9 Total Overheads =B35+B36 =C35+C36 Overhead Asorption Production Production Turning Assembly Machine Rate per Hour =B37/B11 =C37/C11 Labour Rate per Hour =B37/B12 =C37/C12 Job Costing Job 55 Job 70 Materials 300.5 160.4 Labour =2*6.5 =17*6 Overheads - Turning =B44+B43 =B44*3+B43*3 Overheads - Assembly =C44*2+C43 =C44+C43*2 Total Cost =SUM(B49:B52) =SUM(C49:C52) Add: Profit =B53*20% =C53*10% Selling Price =B53+B54 =C53+C54 APQ06T1F.XLS 72
Accounting and Finance - Management Accounting - Overhead Apportionment Solutions - Nit 2 Q6 TASK 1 SOLUTION 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 A B C D E F G HARDCOURT Bros Student Name (a) Basis of Apportionment Apportionment Data Production Production Service Dept Service TOTAL Turning Assembly Warehouse Office Floor Area 60% 20% 10% 10% 100% Number of Employees 10 60 10 20 100 Value of Fixed Assets 50,000 10,000 6,000 4,000 70,000 Machine Hours per Department 500 200 Labour Hours per Department 400 80 (b) Apportionment Overhead Allocated Wages 20,132 Power 35,000 Repairs to Equipment 1,400 Light and Heat 1,000 Rent and Rates 1,000 Overhead Analysis Production Production Service Dept Service Method of Turning Assembly Warehouse Office Apportionment Allocated Wages 5,240 6,160 1,976 6,756 Allocated Wages Power 25,000 5,000 3,000 2,000 Value of Fixed Assets Repairs to Equipment 1,000 200 120 80 Value of Fixed Assets Light and Heat 600 200 100 100 Floor Area Rent and Rates 600 200 100 100 Floor Area Departmental Total 32,440 11,760 5,296 9,036 Service Department - Office 6,024 2,008 1,004 Floor Area Departmental Total 38,464 13,768 6,300 Service Department - Warehouse 900 5,400 Number of Employees Total Overheads 39,364 19,168 Overhead Asorption Production Production Turning Assembly Machine Rate per Hour 78.73 95.84 Labour Rate per Hour 98.41 239.60 Job Costing Job 55 Job 70 Materials 300.50 160.40 Labour 13.00 102.00 Overheads - Turning 177.14 531.41 Overheads - Assembly 575.04 431.28 Total Cost 1,065.68 1,225.09 Add: Profit 213.14 122.51 Selling Price 1,278.81 1,347.60 APQ06T1S.XLS 73
Accounting and Finance - Management Accounting - Overhead Apportionment Solutions - Int 2/Higher Q6 TASK 1 WORKSHEET Formulae Worksheet (Question 6 - Task 1) Complete this worksheet with the appropriate formula for each spreadsheet cell as indicated. Item Cell Formula Allocated Wages (Method of Apportionment) F28 =A18 Power (Turning Dept) B29 =B19/F10*B10 Repairs to Equipment (Assembly Dept) C30 =B20/F10*C10 Light and Heat (Warehouse) D31 =B21*D8 Rent and Rates (Office) E32 =B22*E8 Departmental Total (Turning Dept) B33 =SUM(B28:B32) Machine Rate per Hour (Assembly Dept) C43 =C37/C11 Labour (Job 55) B50 =2*6.5 Overheads - Assembly (Job 70) C51 =B44*3+B43*3 Overheads - Turning (Job 55) B52 =C44*2+C43 Total Cost (Job 70) C53 =SUM(C49:C52) Profit (Job 55) B54 =B53*20% Selling Price (Job 70) C55 =C53+C54 Cost Elements/Systems: Overhead Apportionment 74
Accounting and Finance - Management Accounting - Overhead Apportionment Solutions - Int 2/Higher Q6 TASK 2 CHANGES 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 A B C D E F HARDCOURT Bros Student Name (a) Basis of Apportionment Apportionment Data Production Production Service Dept Service TOTAL Turning Assembly Warehouse Office Floor Area Number of Employees Value of Fixed Assets Machine Hours per Department Labour Hours per Department (b) Apportionment Overhead Allocated Wages Power Repairs to Equipment Light and Heat Rent and Rates Overhead Analysis Production Production Service Dept Service Method of Turning Assembly Warehouse Office Apportionment Allocated Wages Power Repairs to Equipment Light and Heat Rent and Rates Departmental Total Service Department - Office Departmental Total Service Department - Warehouse=D35/SUM(B8:C8)*B8 =D35/SUM(B8:C8)*C8 =A8 Total Overheads Overhead Asorption Production Production Turning Assembly Machine Rate per Hour Labour Rate per Hour Job Costing Job 55 Job 70 Materials Labour Overheads - Turning Overheads - Assembly Total Cost Add: Profit Selling Price =C44*3+C43*2 APQ06T2C.XLS 75
Accounting and Finance - Management Accounting - Overhead Apportionment Solutions - Int 2/Higher Q6 TASK 2 SOLUTION 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 A B C D E F G HARDCOURT Bros Student Name (a) Basis of Apportionment Apportionment Data Production Production Service Dept Service TOTAL Turning Assembly Warehouse Office Floor Area 60% 20% 10% 10% 100% Number of Employees 10 60 10 20 100 Value of Fixed Assets 50,000 10,000 6,000 4,000 70,000 Machine Hours per Department 500 200 Labour Hours per Department 400 80 (b) Apportionment Overhead Allocated Wages 20,132 Power 35,000 Repairs to Equipment 1,400 Light and Heat 1,000 Rent and Rates 1,000 Overhead Analysis Production Production Service Dept Service Method of Turning Assembly Warehouse Office Apportionment Allocated Wages 5,240 6,160 1,976 6,756 Allocated Wages Power 25,000 5,000 3,000 2,000 Value of Fixed Assets Repairs to Equipment 1,000 200 120 80 Value of Fixed Assets Light and Heat 600 200 100 100 Floor Area Rent and Rates 600 200 100 100 Floor Area Departmental Total 32,440 11,760 5,296 9,036 Service Department - Office 6,024 2,008 1,004 Floor Area Departmental Total 38,464 13,768 6,300 Service Department - Warehouse 4,725 1,575 Floor Area Total Overheads 43,189 15,343 Overhead Asorption Production Production Turning Assembly Machine Rate per Hour 86.38 76.72 Labour Rate per Hour 107.97 191.79 Job Costing Job 55 Job 70 Materials 300.50 160.40 Labour 13.00 102.00 Overheads - Turning 194.35 583.05 Overheads - Assembly 728.79 345.22 Total Cost 1,236.64 1,190.67 Add: Profit 247.33 119.07 Selling Price 1,483.97 1,309.74 APQ06T2S.XLS 76
Accounting and Finance - Management Accounting - Overhead Apportionment Solutions - Int 2/Higher Q6 TASK 2 WORKSHEET Formulae Worksheet (Question 6 - Task 2) Complete this worksheet with the appropriate formula for each spreadsheet cell as indicated. Item Cell Formula Service Dept - Warehouse (Turning Dept) B36 =D35/SUM(B8:C8)*B8 Service Dept - Warehouse (Assembly Dept) C36 =D35/SUM(B8:C8)*C8 Overheads - Assembly (Job 55) B52 =C44*3+C43*2 Cost Elements/Systems: Overhead Apportionment 77
Accounting and Finance - Management Accounting - Overhead Apportionment Solutions - Higher Q7 TASK 1 FORMULAE 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 62 KAT-KIT plc (a) Basis of Apportionment Apportionment Data A B C D Production Dept A Dept B Dept C Floor Area 0.2 0.15 0.25 Number of Employees 12 30 24 Value of Fixed Assets 40000 20000 10000 Labour Hours per Department 854 246.5 117.4 Machine Hours per Department 488 493 587 (b) Apportionment Overhead Allocated Expenses 321 Allocated Insurance 312 Light and Heat 2000 Depreciation of Machinery 3000 Rent and Rates 4800 Repairs to Equipment 600 Indirect Wages 320 Overhead Analysis Production Dept A Dept B Dept C Allocated Expenses 40 50 60 Allocated Insurance 20 90 72 Light and Heat =$B$20*B8 =$B$20*C8 =$B$20*D8 Depreciation of Machinery =$B$21/$I$10*B10 =$B$21/$I$10*C10 =$B$21/$I$10*D10 Rent and Rates =$B$22*B8 =$B$22*C8 =$B$22*D8 Repairs to Equipment =$B$23/$I$10*B10 =$B$23/$I$10*C10 =$B$23/$I$10*D10 Indirect Wages =$B$24/$I$9*B9 =$B$24/$I$9*C9 =$B$24/$I$9*D9 Departmental Total =SUM(B30:B36) =SUM(C30:C36) =SUM(D30:D36) Service Department - Personnel =$H$37/SUM($B$9:$G$9)*B9 =$H$37/SUM($B$9:$G$9)*C9 =$H$37/SUM($B$9:$G$9)*D9 Departmental Total =B37+B38 =C37+C38 =D37+D38 Service Department - Canteen =$G$39/SUM($B$8:$F$8)*B8 =$G$39/SUM($B$8:$F$8)*C8 =$G$39/SUM($B$8:$F$8)*D8 Total Overheads =B39+B40 =C39+C40 =D39+D40 Overhead Asorption Production Dept A Dept B Dept C Labour Rate per Hour =B41/B11 =C41/C11 =D41/D11 Machine Rate per Hour =B41/B12 =C41/C12 =D41/D12 Job Costing Job 132 Job 245 Job 456 Materials 14.8 3.9 9.2 Labour =6*4.1 =9*5.24 =8*8.2 Overheads - Dept A =B47 =B47 =B47*2 Overheads - Dept B =C48*2 =C48 =C47 Overheads - Dept C =D47 =D47 =D47 Overheads - Dept D =E47 =E47 =E47*3 Overheads - Dept E =F47 =F47 =F47*2 Total Cost =SUM(B53:B59) =SUM(C53:C59) =SUM(D53:D59) Add: Profit =B60*10% =C60*10% =D60*10% Selling Price =B60+B61 =C60+C61 =D60+D61 APQ07T1F.XLS 78
Accounting and Finance - Management Accounting - Overhead Apportionment Solutions - Higher Q7 TASK 1 FORMULAE (continued) 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 62 E F G H I Student Name Service Dept D Dept E Canteen Personnel 0.05 0.1 0.15 0.1 =SUM(B8:H8) 48 6 36 4 =SUM(B9:H9) 10000 5000 10000 5000 =SUM(B10:H10) 533.2 118 666.5 47.2 Service Method of Dept D Dept E Canteen Personnel Apportionment 84 12 29 46 =A18 50 30 28 22 =A19 =$B$20*E8 =$B$20*F8 =$B$20*G8 =$B$20*H8 =A8 =$B$21/$I$10*E10 =$B$21/$I$10*F10 =$B$21/$I$10*G10 =$B$21/$I$10*H10 =A10 =$B$22*E8 =$B$22*F8 =$B$22*G8 =$B$22*H8 =A8 =$B$23/$I$10*E10 =$B$23/$I$10*F10 =$B$23/$I$10*G10 =$B$23/$I$10*H10 =A10 =$B$24/$I$9*E9 =$B$24/$I$9*F9 =$B$24/$I$9*G9 =$B$24/$I$9*H9 =A9 =SUM(E30:E36) =SUM(F30:F36) =SUM(G30:G36) =SUM(H30:H36) =$H$37/SUM($B$9:$G$9)*E9 =$H$37/SUM($B$9:$G$9)*F9 =$H$37/SUM($B$9:$G$9)*G9 =A9 =E37+E38 =F37+F38 =G37+G38 =$G$39/SUM($B$8:$F$8)*E8 =$G$39/SUM($B$8:$F$8)*F8 =A8 =E39+E40 =F39+F40 =E41/E11 =E41/E12 Dept D =F41/F11 =F41/F12 Dept E Job 874 Job 913 12 18.9 =12*10 =2*3.1 =B48*2 =B48 =C47*3 =C48 =D47*2 =D48*3 =E47 =E48*4 =F48*3 =F47*2 =SUM(E53:E59) =SUM(F53:F59) =E60*10% =F60*10% =E60+E61 =F60+F61 TOTAL APQ07T1F.XLS 79
Accounting and Finance - Management Accounting - Overhead Apportionment Solutions - Higher Q7 TASK 1 SOLUTION 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 62 KAT-KIT plc (a) Basis of Apportionment A B C D E F G H I J Student Name Apportionment Data Production Service TOTAL Dept A Dept B Dept C Dept D Dept E Canteen Personnel Floor Area 20% 15% 25% 5% 10% 15% 10% 100% Number of Employees 12 30 24 48 6 36 4 160 Value of Fixed Assets 40,000 20,000 10,000 10,000 5,000 10,000 5,000 100,000 Labour Hours per Department 854.0 246.5 117.4 533.2 118.0 Machine Hours per Department 488.0 493.0 587.0 666.5 47.2 (b) Apportionment Overhead Allocated Expenses 321 Allocated Insurance 312 Light and Heat 2,000 Depreciation of Machinery 3,000 Rent and Rates 4,800 Repairs to Equipment 600 Indirect Wages 320 Overhead Analysis Production Service Method of Dept A Dept B Dept C Dept D Dept E Canteen Personnel Apportionment Allocated Expenses 40 50 60 84 12 29 46 Allocated Expenses Allocated Insurance 20 90 72 50 30 28 22 Allocated Insurance Light and Heat 400 300 500 100 200 300 200 Floor Area Depreciation of Machinery 1,200 600 300 300 150 300 150 Value of Fixed Assets Rent and Rates 960 720 1,200 240 480 720 480 Floor Area Repairs to Equipment 240 120 60 60 30 60 30 Value of Fixed Assets Indirect Wages 24 60 48 96 12 72 8 Number of Employees Departmental Total 2,884 1,940 2,240 930 914 1,509 936 Service Department - Personnel 72 180 144 288 36 216 Number of Employees Departmental Total 2,956 2,120 2,384 1,218 950 1,725 Service Department - Canteen 460 345 575 115 230 Floor Area Total Overheads 3,416 2,465 2,959 1,333 1,180 Overhead Asorption Production Dept A Dept B Dept C Dept D Dept E Labour Rate per Hour 4.00 10.00 25.20 2.50 10.00 Machine Rate per Hour 7.00 5.00 5.04 2.00 25.00 Job Costing Job 132 Job 245 Job 456 Job 874 Job 913 Materials 14.80 3.90 9.20 12.00 18.90 Labour 24.60 47.16 65.60 120.00 6.20 Overheads - Dept A 4.00 4.00 8.00 14.00 7.00 Overheads - Dept B 10.00 5.00 10.00 30.00 5.00 Overheads - Dept C 25.20 25.20 25.20 50.41 15.12 Overheads - Dept D 2.50 2.50 7.50 2.50 8.00 Overheads - Dept E 10.00 10.00 20.00 75.00 20.00 Total Cost 91.10 97.76 145.50 303.91 80.22 Add: Profit 9.11 9.78 14.55 30.39 8.02 Selling Price 100.21 107.54 160.05 334.30 88.24 APQ07T1S.XLS 80
Accounting and Finance - Management Accounting - Overhead Apportionment Solutions - Higher Q7 TASK 1 WORKSHEET Formulae Worksheet (Question 7 - Task 1) Complete this worksheet with the appropriate formula for each spreadsheet cell as indicated. Item Cell Formula Allocated Expenses (Method of Apportionment) I30 =A18 Light and Heat (Dept A) B32 =$B$20*B8 Depreciation of Machinery (Dept B) C33 =$B$21/$B$10*C10 Departmental Total (Dept C) D37 =SUM(D30:D36) Service Department - Personnel (Dept D) E38 =$H$37/SUM($B$9:$G$9)*E9 Service Department - Canteen (Dept E) F40 =$G$39/SUM($B$8:$F$8)*F8 Machine Rate per Hour (Dept C) D48 =D41/D12 Labour (Job 245) C54 =9.5*5.24 Overheads - Dept D (Job 456) D58 =E47*3 Overheads - Dept E (Job 245) C59 =F47 Total Cost (Job 456) D60 =SUM(D53:D59) Profit (Job 874) E61 =E60*10% Selling Price (Job 913) F62 =F60+F61 Cost Elements/Systems: Overhead Apportionment 81
Accounting and Finance - Management Accounting - Overhead Apportionment Solutions - Higher Q7 TASK 2 CHANGES 1 2 3 4 5 6 7 8 9 10 11 12 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 62 KAT-KIT plc (a) Basis of Apportionment Apportionment Data A B C D Production Dept A Dept B Dept C Floor Area Number of Employees 20 40 25 Value of Fixed Assets Labour Hours per Department 900.0 200.0 Machine Hours per Department 500.0 600.0 650.0 (b) Apportionment Overhead Allocated Expenses Allocated Insurance Light and Heat Depreciation of Machinery Rent and Rates 5,600 Repairs to Equipment Indirect Wages 800 Overhead Analysis Production Dept A Dept B Dept C Allocated Expenses 50 100 80 Allocated Insurance Light and Heat =$B$20/$I$9*B9 =$B$20/$I$9*C9 =$B$20/$I$9*D9 Depreciation of Machinery Rent and Rates Repairs to Equipment Indirect Wages Departmental Total Service Department - Personnel Departmental Total Service Department - Canteen Total Overheads Overhead Asorption Labour Rate per Hour Machine Rate per Hour =$H$37/SUM($B$8:$G=$H$37/SUM($B$8:$=$H$37/SUM($B$8:$G$8) Production Dept A Dept B Dept C Job Costing Job 132 Job 245 Job 456 Materials 16.70 Labour =10*5.5 Overheads - Dept A =B47*2 Overheads - Dept B =C48*2 =C47*2 Overheads - Dept C =D47*2 Overheads - Dept D Overheads - Dept E =F47*2 =F47*3 Total Cost Add: Profit Selling Price APQ07T2C.XLS 82
Accounting and Finance - Management Accounting - Overhead Apportionment Solutions - Higher Q7 TASK 2 CHANGES (continued) 1 2 3 4 5 6 7 8 9 10 11 12 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 62 E F G H I Student Name Service Dept D Dept E Canteen Personnel 50 15 40 10 140.0 TOTAL Service Method of Dept D Dept E Canteen Personnel Apportionment 90 20 72 88 =$B$20/$I$9*E9 =$B$20/$I$9*F9 =$B$20/$I$9*G9 =$B$20/$I$9*H9 =A9 =$H$37/SUM($B$8:$G$8 =$H$37/SUM($B$8:$G$8)*F =$H$37/SUM($B$8:$G$8)*G8 =A8 Dept D Dept E Job 874 Job 913 16.00 =3*4 =C47 =F48 =D48 =E48 APQ07T2C.XLS 83
Accounting and Finance - Management Accounting - Overhead Apportionment Solutions - Higher Q7 TASK 2 SOLUTION 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 62 KAT-KIT plc (a) Basis of Apportionment A B C D E F G H I J Student Name Apportionment Data Production Service TOTAL Dept A Dept B Dept C Dept D Dept E Canteen Personnel Floor Area 20% 15% 25% 5% 10% 15% 10% 100% Number of Employees 20 40 25 50 15 40 10 200 Value of Fixed Assets 40,000 20,000 10,000 10,000 5,000 10,000 5,000 100,000 Labour Hours per Department 900.0 246.5 200.0 533.2 140.0 Machine Hours per Department 500.0 600.0 650.0 666.5 47.2 (b) Apportionment Overhead Allocated Expenses 440 Allocated Insurance 312 Light and Heat 2,000 Depreciation of Machinery 3,000 Rent and Rates 5,600 Repairs to Equipment 600 Indirect Wages 800 Overhead Analysis Production Service Method of Dept A Dept B Dept C Dept D Dept E Canteen Personnel Apportionment Allocated Expenses 50 100 80 90 20 72 88 Allocated Expenses Allocated Insurance 20 90 72 50 30 28 22 Allocated Insurance Light and Heat 200 400 250 500 150 400 100 Number of Employees Depreciation of Machinery 1,200 600 300 300 150 300 150 Value of Fixed Assets Rent and Rates 1,120 840 1,400 280 560 840 560 Floor Area Repairs to Equipment 240 120 60 60 30 60 30 Value of Fixed Assets Indirect Wages 80 160 100 200 60 160 40 Number of Employees Departmental Total 2,910 2,310 2,262 1,480 1,000 1,860 990 Service Department - Personnel 220 165 275 55 110 165 Floor Area Departmental Total 3,130 2,475 2,537 1,535 1,110 2,025 Service Department - Canteen 540 405 675 135 270 Floor Area Total Overheads 3,670 2,880 3,212 1,670 1,380 Overhead Asorption Production Dept A Dept B Dept C Dept D Dept E Labour Rate per Hour 4.08 11.68 16.06 3.13 9.86 Machine Rate per Hour 7.34 4.80 4.94 2.51 29.24 Job Costing Job 132 Job 245 Job 456 Job 874 Job 913 Materials 16.70 3.90 9.20 16.00 18.90 Labour 24.60 55.00 65.60 120.00 12.00 Overheads - Dept A 8.16 4.08 8.16 14.68 7.34 Overheads - Dept B 9.60 9.60 23.37 11.68 4.80 Overheads - Dept C 16.06 32.12 16.06 32.12 4.94 Overheads - Dept D 3.13 3.13 9.40 3.13 2.51 Overheads - Dept E 19.71 9.86 29.57 29.24 19.71 Total Cost 97.96 117.69 161.35 226.85 70.20 Add: Profit 9.80 11.77 16.14 22.69 7.02 Selling Price 107.76 129.46 177.49 249.54 77.22 APQ07T2S.XLS 84
Accounting and Finance - Management Accounting - Overhead Apportionment Solutions - Higher Q7 TASK 2 WORKSHEET Formulae Worksheet (Question 7 - Task 2) Complete this worksheet with the appropriate formula for each spreadsheet cell as indicated. Item Cell Formula Light and Heat (Dept A) B32 =$B$20/$I$9*B9 Light and Heat (Method of Apportionment) I32 =A9 Service Department - Personnel (Dept C) D38 =$H$37/SUM($B$8:$G$8)*B8 Labour (Job 245) C54 =10*5.5 Overheads - Dept A (Job 132) B55 =B47*2 Overheads - Dept E (Job 456) D59 =F47*3 Cost Elements/Systems: Overhead Apportionment 85
Accounting and Finance - Management Accounting - Overhead Apportionment Solutions - Higher Q8 TASK 1 FORMULAE 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 62 LAWSON LAUNDRIES (a) Basis of Apportionment Apportionment Data A B C D Production Dept 1 Dept 2 Dept 3 Floor Area 0.2 0.2 0.1 Number of Employees 40 100 20 Value of Fixed Assets 3000 10000 26000 Labour Hours per Department 300 200 200 Machine Hours per Department 300 100 100 (b) Apportionment Overhead Allocated Expenses =SUM(B30:H30) Allocated Power =SUM(B31:H31) Light and Heat 2000 Depreciation of Machinery 14000 Factory Insurance 4800 Repairs to Equipment 700 Salaries 42000 Overhead Analysis Production Dept 1 Dept 2 Dept 3 Allocated Expenses 60 60 80 Allocated Power 2000 2000 2000 Light and Heat =$B$20*B8 =$B$20*C8 =$B$20*D8 Depreciation of Machinery =$B$21/$I$10*B10 =$B$21/$I$10*C10 =$B$21/$I$10*D10 Factory Insurance =$B$22*B8 =$B$22*C8 =$B$22*D8 Repairs to Equipment =$B$23/$I$10*B10 =$B$23/$I$10*C10 =$B$23/$I$10*D10 Salaries =$B$24/$I$9*B9 =$B$24/$I$9*C9 =$B$24/$I$9*D9 Departmental Total =SUM(B30:B36) =SUM(C30:C36) =SUM(D30:D36) Service Department - Warehouse =$H$37/SUM($B$9:$G$9)*B9 =$H$37/SUM($B$9:$G$9)*C9 =$H$37/SUM($B$9:$G$9)*D9 Departmental Total =B37+B38 =C37+C38 =D37+D38 Service Department - Office =$G$39/SUM($B$8:$F$8)*B8 =$G$39/SUM($B$8:$F$8)*C8 =$G$39/SUM($B$8:$F$8)*D8 Total Overheads =B39+B40 =C39+C40 =D39+D40 Overhead Asorption Production Dept 1 Dept 2 Dept 3 Labour Rate per Hour =B41/B11 =C41/C11 =D41/D11 Machine Rate per Hour =B41/B12 =C41/C12 =D41/D12 Job Costing Job 1 Job 2 Job 3 Materials 13.8 33.9 45.6 Labour =6*4.1 =9*5.24 =10*4.2 Overheads - Dept 1 =B47 =B47 =B48*2 Overheads - Dept 2 =C48*2 =C48 =C47*2 Overheads - Dept 3 =D47 =D47 =D48*2 Overheads - Dept 4 =E47 =E47 =E48 Overheads - Dept 5 =F47 =F47 =F48 Total Cost =SUM(B53:B59) =SUM(C53:C59) =SUM(D53:D59) Add: Profit =B60*12% =C60*12% =D60*12% Selling Price =B60+B61 =C60+C61 =D60+D61 APQ08T1F.XLS 86
Accounting and Finance - Management Accounting - Overhead Apportionment Solutions - Higher Q8 TASK 1 FORMULAE (continued) 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 62 E F G H I Student Name Service Dept 4 Dept 5 Office Warehouse 0.1 0.2 0.1 0.1 1 40 30 20 30 =SUM(B9:H9) 9000 12000 5000 5000 =SUM(B10:H10) 300 400 70 80 Service Method of Dept 4 Dept 5 Office Warehouse Apportionment 80 120 120 120 =A18 2000 2000 110 750 =A19 =$B$20*E8 =$B$20*F8 =$B$20*G8 =$B$20*H8 =A8 =$B$21/$I$10*E10 =$B$21/$I$10*F10 =$B$21/$I$10*G10 =$B$21/$I$10*H10 =A10 =$B$22*E8 =$B$22*F8 =$B$22*G8 =$B$22*H8 =A8 =$B$23/$I$10*E10 =$B$23/$I$10*F10 =$B$23/$I$10*G10 =$B$23/$I$10*H10 =A10 =$B$24/$I$9*E9 =$B$24/$I$9*F9 =$B$24/$I$9*G9 =$B$24/$I$9*H9 =A9 =SUM(E30:E36) =SUM(F30:F36) =SUM(G30:G36) =SUM(H30:H36) =$H$37/SUM($B$9:$G$9)*E9 =$H$37/SUM($B$9:$G$9)*F9 =$H$37/SUM($B$9:$G$9)*G9 =A9 =E37+E38 =F37+F38 =G37+G38 =$G$39/SUM($B$8:$F$8)*E8 =$G$39/SUM($B$8:$F$8)*F8 =A8 =E39+E40 =F39+F40 =E41/E11 =E41/E12 Dept 4 Dept 5 =F41/F11 =F41/F12 Job 4 Job 5 32.8 34.2 =2*4.5 =1*9 =B48 =B47*2 =C47 =C48*3 =D48 =D47*2 =E47*2 =E48 =F48 =F47*2 =SUM(E53:E59) =E60*12% =E60+E61 =SUM(F53:F59) =F60*12% =F60+F61 TOTAL APQ08T1F.XLS 87
Accounting and Finance - Management Accounting - Overhead Apportionment Solutions - Higher Q8 TASK 1 SOLUTION 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 62 A B C D E F G H I J LAWSON LAUNDRIES Student Name (a) Basis of Apportionment Apportionment Data Production Service TOTAL Dept 1 Dept 2 Dept 3 Dept 4 Dept 5 Office Warehouse Floor Area 20% 20% 10% 10% 20% 10% 10% 100% Number of Employees 40 100 20 40 30 20 30 280 Value of Fixed Assets 3,000 10,000 26,000 9,000 12,000 5,000 5,000 70,000 Labour Hours per Department 300 200 200 300 400 Machine Hours per Department 300 100 100 70 80 (b) Apportionment Overhead Allocated Expenses 640 Allocated Power 10,860 Light and Heat 2,000 Depreciation of Machinery 14,000 Factory Insurance 4,800 Repairs to Equipment 700 Salaries 42,000 Overhead Analysis Production Service Method of Dept 1 Dept 2 Dept 3 Dept 4 Dept 5 Office Warehouse Apportionment Allocated Expenses 60 60 80 80 120 120 120 Allocated Expenses Allocated Power 2,000 2,000 2,000 2,000 2,000 110 750 Allocated Power Light and Heat 400 400 200 200 400 200 200 Floor Area Depreciation of Machinery 600 2,000 5,200 1,800 2,400 1,000 1,000 Value of Fixed Assets Factory Insurance 960 960 480 480 960 480 480 Floor Area Repairs to Equipment 30 100 260 90 120 50 50 Value of Fixed Assets Salaries 6,000 15,000 3,000 6,000 4,500 3,000 4,500 Number of Employees Departmental Total 10,050 20,520 11,220 10,650 10,500 4,960 7,100 Service Department - Warehous 1,136 2,840 568 1,136 852 568 Number of Employees Departmental Total 11,186 23,360 11,788 11,786 11,352 5,528 Service Department - Office 1,382 1,382 691 691 1,382 Floor Area Total Overheads 12,568 24,742 12,479 12,477 12,734 Overhead Asorption Production Dept 1 Dept 2 Dept 3 Dept 4 Dept 5 Labour Rate per Hour 41.89 123.71 62.40 41.59 31.84 Machine Rate per Hour 41.89 247.42 124.79 178.24 159.18 Job Costing Job 1 Job 2 Job 3 Job 4 Job 5 Materials 13.80 33.90 45.60 32.80 34.20 Labour 24.60 47.16 42.00 9.00 9.00 Overheads - Dept 1 41.89 41.89 83.79 41.89 83.79 Overheads - Dept 2 494.84 247.42 247.42 123.71 742.26 Overheads - Dept 3 62.40 62.40 249.58 124.79 124.79 Overheads - Dept 4 41.59 41.59 178.24 83.18 178.24 Overheads - Dept 5 31.84 31.84 159.18 159.18 63.67 Total Cost 710.95 506.19 1,005.80 574.55 1,235.95 Add: Profit 85.31 60.74 120.70 68.95 148.31 Selling Price 796.27 566.94 1,126.50 643.49 1,384.26 APQ08T1S.XLS 88
Accounting and Finance - Management Accounting - Overhead Apportionment Solutions - Higher Q8 TASK 1 WORKSHEET Formulae Worksheet (Question 8 - Task 1) Complete this worksheet with the appropriate formula for each spreadsheet cell as indicated. Item Cell Formula Allocated Power (Method of Apportionment) I31 =A19 Light and Heat (Dept 1) B32 =$B$20*B8 Depreciation of Machinery (Dept 2) C33 =$B$21/$I$10*C10 Factory Insurance (Dept 3) D34 =$B$22*D8 Repairs to Equipment (Dept 4) E35 =$B$23/$I$10*E10 Salaries (Dept 5) F36 =$B$24/$I$9*F9 Departmental Total (Dept 1) B37 =SUM(B30:B36) Service Department - Warehouse (Dept 2) C38 =$H$37/SUM($B$9:$G$9)*C9 Service Department - Office (Dept 3) D40 =$G$39/SUM($B$8:$F$8)*D8 Labour Rate per Hour (Dept 4) E47 =E41/E11 Machine Rate per Hour (Dept 5) F48 =F41/F12 Overheads - Dept 1 (Job 1) B56 =C48*2 Add: Profit (Job 2) C61 =C60*12% Cost Elements/Systems: Overhead Apportionment 89
Accounting and Finance - Management Accounting - Overhead Apportionment Solutions - Higher Q8 TASK 2 CHANGES 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 62 LAWSON LAUNDRIES (a) Basis of Apportionment Apportionment Data A B C D Production Dept 1 Dept 2 Dept 3 Floor Area 0.15 0.1 0.2 Number of Employees Value of Fixed Assets Labour Hours per Department 500 100 250 Machine Hours per Department 150 150 200 (b) Apportionment Overhead Allocated Expenses Allocated Power Light and Heat 3000 Depreciation of Machinery Factory Insurance 7000 Repairs to Equipment Salaries Overhead Analysis Production Dept 1 Dept 2 Dept 3 Allocated Expenses Allocated Power 2500 2500 1000 Light and Heat Depreciation of Machinery Factory Insurance =$B$22/$I$10*B10 =$B$22/$I$10*C10 =$B$22/$I$10*D10 Repairs to Equipment Salaries Departmental Total Service Department - Warehouse Departmental Total Service Department - Office =$G$39/SUM($B$9:$G$9)*B9 =$G$39/SUM($B$9:$G$9)*C9 =$G$39/SUM($B$9:$G$9)*D9 Total Overheads Overhead Asorption Labour Rate per Hour Machine Rate per Hour Production Dept 1 Dept 2 Dept 3 Job Costing Job 1 Job 2 Job 3 Materials 14.8 Labour =10*4.5 Overheads - Dept 1 =B48 Overheads - Dept 2 Overheads - Dept 3 =D47*2 =D47 Overheads - Dept 4 =E47*2 =E47*2 Overheads - Dept 5 =F47 Total Cost Add: Profit Selling Price APQ08T2C.XLS 90
Accounting and Finance - Management Accounting - Overhead Apportionment Solutions - Higher Q8 TASK 2 CHANGES (continued) 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 62 E F G H I Student Name Service Dept 4 Dept 5 Office Warehouse 0.2 0.15 200 450 100 100 Service Method of Dept 4 Dept 5 Office Warehouse Apportionment 3000 1258 1930 =$B$22/$I$10*E10 =$B$22/$I$10*F10 =$B$22/$I$10*G10 =$B$22/$I$10*H10 =A10 =$G$39/SUM($B$9:$G$9)*E9 =$G$39/SUM($B$9:$G$9)*F9 =A9 Dept 4 Dept 5 Job 4 Job 5 33.5 =4*4.8 =B48*2 =C48 =C48 =E48*2 TOTAL APQ08T2C.XLS 91
Accounting and Finance - Management Accounting - Overhead Apportionment Solutions - Higher Q8 TASK 2 SOLUTION 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 62 A B C D E F G H I J LAWSON LAUNDRIES Student Name (a) Basis of Apportionment Apportionment Data Production Service TOTAL Dept 1 Dept 2 Dept 3 Dept 4 Dept 5 Office Warehouse Floor Area 15% 10% 20% 20% 15% 10% 10% 100% Number of Employees 40 100 20 40 30 20 30 280 Value of Fixed Assets 3,000 10,000 26,000 9,000 12,000 5,000 5,000 70,000 Labour Hours per Department 500 100 250 200 450 Machine Hours per Department 150 150 200 100 100 (b) Apportionment Overhead Allocated Expenses 640 Allocated Power 14,188 Light and Heat 3,000 Depreciation of Machinery 14,000 Factory Insurance 7,000 Repairs to Equipment 700 Salaries 42,000 Overhead Analysis Production Service Method of Dept 1 Dept 2 Dept 3 Dept 4 Dept 5 Office Warehouse Apportionment Allocated Expenses 60 60 80 80 120 120 120 Allocated Expenses Allocated Power 2,500 2,500 1,000 2,000 3,000 1,258 1,930 Allocated Power Light and Heat 450 300 600 600 450 300 300 Floor Area Depreciation of Machinery 600 2,000 5,200 1,800 2,400 1,000 1,000 Value of Fixed Assets Factory Insurance 300 1,000 2,600 900 1,200 500 500 Value of Fixed Assets Repairs to Equipment 30 100 260 90 120 50 50 Value of Fixed Assets Salaries 6,000 15,000 3,000 6,000 4,500 3,000 4,500 Number of Employees Departmental Total 9,940 20,960 12,740 11,470 11,790 6,228 8,400 Service Department - Warehous 1,344 3,360 672 1,344 1,008 672 Number of Employees Departmental Total 11,284 24,320 13,412 12,814 12,798 6,900 Service Department - Office 1,200 3,000 600 1,200 900 Number of Employees Total Overheads 12,484 27,320 14,012 14,014 13,698 Overhead Asorption Production Dept 1 Dept 2 Dept 3 Dept 4 Dept 5 Labour Rate per Hour 24.97 273.20 56.05 70.07 30.44 Machine Rate per Hour 83.23 182.13 70.06 140.14 136.98 Job Costing Job 1 Job 2 Job 3 Job 4 Job 5 Materials 14.80 33.90 45.60 33.50 34.20 Labour 24.60 45.00 42.00 9.00 19.20 Overheads - Dept 1 24.97 83.23 166.45 166.45 49.94 Overheads - Dept 2 364.27 182.13 546.40 182.13 182.13 Overheads - Dept 3 112.10 56.05 56.05 70.06 112.10 Overheads - Dept 4 140.14 140.14 140.14 140.14 280.28 Overheads - Dept 5 30.44 30.44 30.44 136.98 60.88 Total Cost 711.31 570.89 1,027.08 738.27 738.73 Add: Profit 85.36 68.51 123.25 88.59 88.65 Selling Price 796.67 639.39 1,150.33 826.86 827.37 APQ08T2S.XLS 92
Accounting and Finance - Management Accounting - Overhead Apportionment Solutions - Higher Q8 TASK 2 WORKSHEET Formulae Worksheet (Question 8 - Task 2) Complete this worksheet with the appropriate formula for each spreadsheet cell as indicated. Item Cell Formula Factory Insurance (Dept 1) B34 =$B$22/$I$10*B10 Service Department - Office (Dept 2) C40 =$G$39/SUM($B$9:$G$9)*C9 Labour (Job 5) F54 =4*4.8 Overheads - Dept 3 (Job 1) B57 =D47*2 Overheads - Dept 4 (Job 5) F58 =E48*2 Overheads - Dept 5 (Job 3) D59 =F47 Cost Elements/Systems: Overhead Apportionment 93
Accounting and Finance - Management Accounting - Overhead Apportionment Solutions - Higher Q9 TASK 1 FORMULAE 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 62 A B C D MANOR TEXTILES plc (a) Basis of Apportionment Apportionment Data Production Spinning Weaving Binding Floor Area (sq m) 200 300 100 Number of Employees 20 30 10 Value of Fixed Assets 20000 40000 10000 Labour Hours per Department 68 48 40 Machine Hours per Department 160 280 230 (b) Apportionment Overhead Allocated Materials 476 Allocated Insurance 760 Power 2000 Light and Heat 720 Depreciation of Machinery 800 Rent and Rates 1440 Repairs to Equipment 480 Overhead Analysis Production Spinning Weaving Binding Allocated Materials 70 70 70 Allocated Insurance 150 150 140 Power =$B$20/$I$10*B10 =$B$20/$I$10*C10 =$B$20/$I$10*D10 Light and Heat =$B$21/SUM($B$8:$H$8)*B8 =$B$21/SUM($B$8:$H$8)*C8 =$B$21/SUM($B$8:$H$8)*D8 Depreciation of Machinery =$B$22/$I$10*B10 =$B$22/$I$10*C10 =$B$22/$I$10*D10 Rent and Rates =$B$23/SUM($B$8:$H$8)*B8 =$B$23/SUM($B$8:$H$8)*C8 =$B$23/SUM($B$8:$H$8)*D8 Repairs to Equipment =$B$24/$I$10*B10 =$B$24/$I$10*C10 =$B$24/$I$10*D10 Departmental Total =SUM(B30:B36) =SUM(C30:C36) =SUM(D30:D36) Service Department - Canteen =$H$37/SUM($B$8:$G$8)*B8 =$H$37/SUM($B$8:$G$8)*C8 =$H$37/SUM($B$8:$G$8)*D8 Departmental Total =B37+B38 =C37+C38 =D37+D38 Service Department - Office =$G$39/SUM($B$10:$F$10)*B10 =$G$39/SUM($B$10:$F$10)*C10 =$G$39/SUM($B$10:$F$10)*D10 Total Overheads =B39+B40 =C39+C40 =D39+D40 Overhead Asorption Production Spinning Weaving Binding Labour Rate per Hour =B41/B11 =C41/C11 =D41/D11 Machine Rate per Hour =B41/B12 =C41/C12 =D41/D12 Job Costing Dundee Clyde Perth Materials 10.8 9.7 2.7 Labour =6*4 =9*5 =2*8 Overheads - Spinning =B47*2 =B47 =B48 Overheads - Weaving =C48 =C48*2 =C47 Overheads - Binding =D47*2 =D47 =D48*4 Overheads - Assembly =E47*3 =E47*2 =E48*2 Overheads - Packing =F47 =F47 =F48 Total Cost =SUM(B53:B59) =SUM(C53:C59) =SUM(D53:D59) Add: Profit =B60*8% =C60*8% =D60*8% Selling Price =B60+B61 =C60+C61 =D60+D61 APQ09T1F.XLS 94
Accounting and Finance - Management Accounting - Overhead Apportionment Solutions - Higher Q9 TASK 1 FORMULAE (continued) 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 62 E F G H I Student Name Service Assembly Packing Office Canteen 100 200 100 200 =SUM(B8:H8) 20 5 30 5 =SUM(B9:H9) 2000 1000 5000 2000 =SUM(B10:H10) 20 44 230 260 Service Method of Assembly Packing Office Canteen Apportionment 70 70 76 50 =A18 68 99 65 88 =A19 =$B$20/$I$10*E10 =$B$20/$I$10*F10 =$B$20/$I$10*G10 =$B$20/$I$10*H10 =A10 =$B$21/SUM($B$8:$H$8)*E8 =$B$21/SUM($B$8:$H$8)*F8 =$B$21/SUM($B$8:$H$8)*G8 =$B$21/SUM($B$8:$H$8)*H8 =A8 =$B$22/$I$10*E10 =$B$22/$I$10*F10 =$B$22/$I$10*G10 =$B$22/$I$10*H10 =A10 =$B$23/SUM($B$8:$H$8)*E8 =$B$23/SUM($B$8:$H$8)*F8 =$B$23/SUM($B$8:$H$8)*G8 =$B$23/SUM($B$8:$H$8)*H8 =A8 =$B$24/$I$10*E10 =$B$24/$I$10*F10 =$B$24/$I$10*G10 =$B$24/$I$10*H10 =A10 =SUM(E30:E36) =SUM(F30:F36) =SUM(G30:G36) =SUM(H30:H36) =$H$37/SUM($B$8:$G$8)*E8 =$H$37/SUM($B$8:$G$8)*F8 =$H$37/SUM($B$8:$G$8)*G8 =A8 =E37+E38 =F37+F38 =G37+G38 =$G$39/SUM($B$10:$F$10)*E10 =$G$39/SUM($B$10:$F$10)*F10 =A10 =E39+E40 =F39+F40 =E41/E11 =E41/E12 Assembly =F41/F11 =F41/F12 Ayr 19.45 6.8 =4*6 =4*2 =B48*2 =B48 =C47*2 =D48 =D47 =E48 =E47 =F47*4 =F48 =SUM(E53:E59) =E60*8% =E60+E61 =C47*3 =SUM(F53:F59) =F60*8% =F60+F61 Packing Inverness TOTAL APQ09T1F.XLS 95
Accounting and Finance - Management Accounting - Overhead Apportionment Solutions - Higher Q9 TASK 1 SOLUTION 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 62 A B C D E F G H I J MANOR TEXTILES plc Student Name (a) Basis of Apportionment Apportionment Data Production Service TOTAL Spinning Weaving Binding Assembly Packing Office Canteen Floor Area (sq m) 200 300 100 100 200 100 200 1,200 Number of Employees 20 30 10 20 5 30 5 120 Value of Fixed Assets 20,000 40,000 10,000 2,000 1,000 5,000 2,000 80,000 Labour Hours per Department 68 48 40 20 44 Machine Hours per Department 160 280 230 230 260 (b) Apportionment Overhead Allocated Materials 476 Allocated Insurance 760 Power 2,000 Light and Heat 720 Depreciation of Machinery 800 Rent and Rates 1,440 Repairs to Equipment 480 Overhead Analysis Production Service Method of Spinning Weaving Binding Assembly Packing Office Canteen Apportionment Allocated Materials 70 70 70 70 70 76 50 Allocated Materials Allocated Insurance 150 150 140 68 99 65 88 Allocated Insurance Power 500 1,000 250 50 25 125 50 Value of Fixed Assets Light and Heat 120 180 60 60 120 60 120 Floor Area (sq m) Depreciation of Machinery 200 400 100 20 10 50 20 Value of Fixed Assets Rent and Rates 240 360 120 120 240 120 240 Floor Area (sq m) Repairs to Equipment 120 240 60 12 6 30 12 Value of Fixed Assets Departmental Total 1,400 2,400 800 400 570 526 580 Service Department - Canteen 116 174 58 58 116 58 Floor Area (sq m) Departmental Total 1,516 2,574 858 458 686 584 Service Department - Office 160 320 80 16 8 Value of Fixed Assets Total Overheads 1,676 2,894 938 474 694 Overhead Asorption Production Spinning Weaving Binding Assembly Packing Labour Rate per Hour 24.65 60.29 23.45 23.70 15.77 Machine Rate per Hour 10.48 10.34 4.08 2.06 2.67 Job Costing Dundee Clyde Perth Ayr Inverness Materials 10.80 9.70 2.70 19.45 6.80 Labour 24.00 45.00 16.00 24.00 8.00 Overheads - Spinning 49.29 24.65 10.48 20.95 10.48 Overheads - Weaving 10.34 20.67 60.29 120.58 180.88 Overheads - Binding 46.90 23.45 16.31 4.08 23.45 Overheads - Assembly 71.10 47.40 4.12 2.06 23.70 Overheads - Packing 15.77 15.77 2.67 63.09 2.67 Total Cost 228.20 186.64 112.57 254.21 255.97 Add: Profit 18.26 14.93 9.01 20.34 20.48 Selling Price 246.46 201.57 121.58 274.55 276.45 APQ09T1S.XLS 96
Accounting and Finance - Management Accounting - Overhead Apportionment Solutions - Higher Q9 TASK 1 WORKSHEET Formulae Worksheet (Question 9 - Task 1) Complete this worksheet with the appropriate formula for each spreadsheet cell as indicated. Item Cell Formula Allocated Materials (Method of Apportionment) I30 =A18 Power (Spinning) B32 =$B$20/$I$10*B10 Light and Heat (Weaving) C33 =$B$21/SUM($B$8:$H$8)*C8 Depreciation of Machinery (Binding) D34 =$B$22/$I$10*D10 Rent and Rates (Assembly) E35 =$B$23/SUM($B$8:$H$8)*E8 Repairs to Equipment (Packing) F36 =$B$24/$I$10*F10 Departmental Total (Spinning) B37 =SUM(B30:B36) Service Department - Office (Weaving) C38 =$H$37/SUM($B$8:$G$8)*C8 Service Department - Canteen (Binding) D40 =$G$39/SUM($B$10:$F$10)*D10 Labour Rate per Hour (Assembly) E47 =E41/E11 Machine Rate per Hour (Packing) F48 =F41/F12 Overheads - Weaving (Dundee) B56 =C48 Add: Profit (Clyde) C61 =C60*8% Cost Elements/Systems: Overhead Apportionment 97
Accounting and Finance - Management Accounting - Overhead Apportionment Solutions - Higher Q9 TASK 2 CHANGES 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 62 A B C D MANOR TEXTILES plc (a) Basis of Apportionment Apportionment Data Production Spinning Weaving Binding Floor Area (sq m) 300 400 200 Number of Employees Value of Fixed Assets Labour Hours per Department 70 50 Machine Hours per Department 200 300 250 (b) Apportionment Overhead Allocated Materials =SUM(B30:H30) Allocated Insurance =SUM(B31:H31) Power 4000 Light and Heat Depreciation of Machinery Rent and Rates Repairs to Equipment 560 Overhead Analysis Production Spinning Weaving Binding Allocated Materials 100 120 100 Allocated Insurance Power Light and Heat Depreciation of Machinery Rent and Rates Repairs to Equipment Departmental Total Service Department - Canteen =$H$37/SUM($B$9:$G$9)*B9 =$H$37/SUM($B$9:$G$9)*C9 =$H$37/SUM($B$9:$G$9)*D9 Departmental Total Service Department - Office =$G$39/SUM($B$9:$F$9)*B9 =$G$39/SUM($B$9:$F$9)*C9 =$G$39/SUM($B$9:$F$9)*D9 Total Overheads Overhead Asorption Labour Rate per Hour Machine Rate per Hour Production Spinning Weaving Binding Job Costing Dundee Clyde Perth Materials 17.8 Labour =2*6.5 Overheads - Spinning =B48 Overheads - Weaving =C47 =C47*2 Overheads - Binding =D47*2 Overheads - Assembly Overheads - Packing =F47*2 =F47 Total Cost Add: Profit Selling Price APQ09T2C.XLS 98
Accounting and Finance - Management Accounting - Overhead Apportionment Solutions - Higher Q9 TASK 2 CHANGES (continued) 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 62 E F G H I Student Name Service Assembly Packing Office Canteen 150 150 150 150 50 250 300 Service Method of Assembly Packing Office Canteen Apportionment 80 120 84 118 107 =$H$37/SUM($B$9:$G$9)*E9 =$H$37/SUM($B$9:$G$9)*F9 =$H$37/SUM($B$9:$G$9)*G9 =A9 =$G$39/SUM($B$9:$F$9)*E9 =$G$39/SUM($B$9:$F$9)*F9 =A9 Assembly Packing Ayr 18.5 =6*9.8 =C47 =E48*2 =F47 =F48*2 Inverness TOTAL APQ09T2C.XLS 99
Accounting and Finance - Management Accounting - Overhead Apportionment Solutions - Higher Q9 TASK 2 SOLUTION 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 62 A B C D E F G H I J MANOR TEXTILES plc Student Name (a) Basis of Apportionment Apportionment Data Production Service TOTAL Spinning Weaving Binding Assembly Packing Office Canteen Floor Area (sq m) 300 400 200 150 150 150 150 1,500 Number of Employees 20 30 10 20 5 30 5 120 Value of Fixed Assets 20,000 40,000 10,000 2,000 1,000 5,000 2,000 80,000 Labour Hours per Department 70 50 40 20 50 Machine Hours per Department 200 300 250 250 300 (b) Apportionment Overhead Allocated Materials 722 Allocated Insurance 779 Power 4,000 Light and Heat 720 Depreciation of Machinery 800 Rent and Rates 1,440 Repairs to Equipment 560 Overhead Analysis Production Service Method of Spinning Weaving Binding Assembly Packing Office Canteen Apportionment Allocated Materials 100 120 100 80 120 84 118 Allocated Materials Allocated Insurance 150 150 140 68 99 65 107 Allocated Insurance Power 1,000 2,000 500 100 50 250 100 Value of Fixed Assets Light and Heat 144 192 96 72 72 72 72 Floor Area (sq m) Depreciation of Machinery 200 400 100 20 10 50 20 Value of Fixed Assets Rent and Rates 288 384 192 144 144 144 144 Floor Area (sq m) Repairs to Equipment 140 280 70 14 7 35 14 Value of Fixed Assets Departmental Total 2,022 3,526 1,198 498 502 700 575 Service Department - Canteen 100 150 50 100 25 150 Number of Employees Departmental Total 2,122 3,676 1,248 598 527 850 Service Department - Office 200 300 100 200 50 Number of Employees Total Overheads 2,322 3,976 1,348 798 577 Overhead Asorption Production Spinning Weaving Binding Assembly Packing Labour Rate per Hour 33.17 79.52 33.70 39.90 11.54 Machine Rate per Hour 11.61 13.25 5.39 3.19 1.92 Job Costing Dundee Clyde Perth Ayr Inverness Materials 10.80 9.70 2.70 19.45 6.80 Labour 24.00 45.00 16.00 24.00 8.00 Overheads - Spinning 66.34 33.17 11.61 23.22 11.61 Overheads - Weaving 13.25 26.51 79.52 159.04 238.56 Overheads - Binding 67.40 33.70 21.57 5.39 33.70 Overheads - Assembly 119.70 79.80 6.38 3.19 39.90 Overheads - Packing 11.54 11.54 1.92 46.16 1.92 Total Cost 313.04 239.42 139.71 280.45 340.49 Add: Profit 25.04 19.15 11.18 22.44 27.24 Selling Price 338.08 258.57 150.88 302.89 367.73 APQ09T2S.XLS 100
Accounting and Finance - Management Accounting - Overhead Apportionment Solutions - Higher Q9 TASK 2 WORKSHEET Formulae Worksheet (Question 9 - Task 2) Complete this worksheet with the appropriate formula for each spreadsheet cell as indicated. Item Cell Formula Allocated Materials (Spinning) B18 =SUM(B30:H30) Allocated Insurance (Spinning) B19 =SUM(B31:H31) Service Dept - Office (Spinning) B38 =$H$37/SUM($B$9:$G$9)*B9 Service Dept - Canteen (Method of Apportionment) I40 =A9 Overheads - Spinning (Inverness) F54 =6*9.8 Overheads - Packing (Inverness) F59 =F48*2 Cost Elements/Systems: Overhead Apportionment 101
Accounting and Finance - Management Accounting - Overhead Apportionment Solutions - Int 2/Higher 102