| |
Part a) Apportion overhead cost
|
Basis |
Functions |
Accom. |
Restaur. |
Maint. |
Admin. |
Total |
|
|
€ |
€ |
€ |
€ |
€ |
€ |
Insurance of property |
Sq mts |
7,000 |
2,800 |
1,400 |
3,500 |
6,300 |
21,000 |
Insurance (liability) |
No.emp |
6,000 |
4,000 |
5,000 |
2,000 |
3,000 |
20,000 |
Heat and light |
Kw hrs |
12,000 |
14,000 |
6,000 |
2,000 |
6,000 |
40,000 |
Depreciation |
Assets |
27,000 |
8,000 |
5,000 |
5,000 |
15,000 |
60,000 |
Advertising |
Sales |
8,000 |
20,000 |
12,000 |
0 |
0 |
40,000 |
Indirect labour |
Given |
|
|
|
40,000 |
50,000 |
90,000 |
Indirect materials |
Given |
|
|
|
30,000 |
20,000 |
50,000 |
Total overheads |
|
60,000 |
48,800 |
29,400 |
82,500 |
100,300 |
321,000 |
Part b) Re-apportion service centre costs
Re-apportion administration |
No.emp |
35,400 |
23,600 |
29,500 |
11,800 |
(100,300) |
|
|
|
|
|
|
94,300 |
|
|
Re-apportion maintenance |
Maint hrs |
62,867 |
23,575 |
7,858 |
(94,300) |
|
|
Total Overhead |
|
158,267 |
95,975 |
66,758 |
0 |
0 |
321,000 |
Part c) Overhead absorption rates
|
Functions |
Accommodation |
Restaurant |
Total Overhead |
€158,267 |
€95,975 |
€66,758 |
Budget customer usage |
1,200 |
15,000 |
20,000 |
|
|
|
|
Budget absorption rates |
€ 131.889 |
€ 6.398 |
€ 3.338 |
|
per hour |
per night |
per cover |
|
|
|
|
Part d) Under / over absorption
|
Functions |
Accommodation |
Restaurant |
|
€ |
€ |
€ |
Actual overhead |
159,100 |
95,500 |
66,650 |
Absorbed overhead * |
160,904 |
95,335 |
67,593 |
Under / over absorbed
|
1,804over |
165 under
|
943 over |
* |
|
|
|
Actual usage by the rates from part c) |
1,220x€131.889 |
14,900x€6.398 |
20,250x€3.338 |
|
|
|
|
|