JULY 2020

Required:
a. Prepare an overhead analysis sheet for the company to show the allocation, apportionment, and reapportionment. (Answer are to be rounded up
to the nearest RM)

(15 marks)

TOTAL MAINTENANCE
OVERHEAD BASIS (RM) MIXING(RM) FINISHING (RM) PACKAGING(RM) STORE (RM) (RM)
Indirect Material Allocated 145,000 65,000 25,000 34,000 7,000 14,000
Depreciation of
Area 55,000 [14,400/60,000] x [12,000/60,000] x [18,000/60,000] x [10,800/60,000] x [4,800/60,000] x
Building 55,000 =13,200 55,000 =11,000 55,000 =16,500 55,000 =9,900 55,000 =4,400
Depreciation of Value of [210,000/700,000] x [420,000/700,000] x [70,000/700,000] x
Plant Plant 75,000 75,000 = 22,500 75,000 = 45,000 75,000 = 7,500
[14,400/60,000] x [12,000/60,000] x [18,000/60,000] x [10,800/60,000] x [4,800/60,000] x
Lighting Area 54,000 54,000 =12,960 54,000 =10,800 54,000 =16,200 54,000 =9,720 54,000 =4,320

Supervision Number of 30,000 [15/60] x 30,000 = [12/60] x 30,000 = [24/60] x 30,000 = [3/60] x 30,000 = [6/60] x 30,000 =
Employees 7,500 6,000 12,000 1,500 3,000
Reapportionment 359,000 121,160 97,800 86,200 28,120 25,720
Number of [32/80] x 28,120= [24/80] x 28,120= [20/80] x 28,120= 25,720
Store Material [4/80] x 28,120= + 1,406
11,248 8,436 7,030
Requisition 1,406 =27,126
Maintenance [40/100] x 27,126= [35/100] x 27,126= [25/100] x 27,126=
Maintenance Hour 10,850 9,494 6,782
359,000 143,258 115,730 100,012
b. Calculate:
i. The overhead absorption rate for mixing department, finishing department and packaging department by using appropriate basis. (Answer are to
be rounded up to 2 decimal places)

(3 marks)

Mixing Finishing Packaging

100,012 / 5,000 x
115,730 10%= RM2 per
143,258/15,000= Machine Hour
OAR Department Rate /10,000=
RM9.55 per
RM11.57 per
Machine Hour 100,012 / 12,000 x
Machine Hour
90%= RM7.50 per
Direct Labour Hour

ii. Over or under absorption of overhead for each department. (Answer are to be rounded up to the nearest RM)

(3 marks)

Mixing Finishing Packaging

2 x 8,000= 16,000
9.55 x 14,000= 11.57 x 11,000=
Overhead Absorbed 7.5 x 10,000= 75,000
133,700 127,270
91,000
Overhead Actual 140,000 102,700 80,500
140,000 - 102,700 -
80,500 - 91,000=
Over (Under) Absorb 133,700= 127,270=
RM10,500 over
RM6,300 under RM24,570 over
DEC 2019
Required:

a. Prepare an Overhead Analysis Sheet. Re-apportion the overhead cost of the service departments to the production departments using
repeated distribution method.
(All calculations are to be rounded up to the nearest RM)
(15 marks)

TOTAL MACHINING INSPECTION FINISHING CANTEEN MAINTENANCE

OVERHEAD BASIS
(RM) (RM) (RM) (RM) (RM) (RM)
Rental charges Floor Area 40,000 14,035 9,825 5,614 5,614 4,912
Machine expenses Machine hours 12,400 12,400
Depreciation of
Machine value 26,800 10,308 5,497 4,810 3,436 2,749
machinery
Depreciation of building Floor area 36,400 12,772 8,940 5,109 5,109 4,470
Electricity Floor Area 48,400 16,982 11,888 6,793 6,793 5,944
Production supervisor
No of employee 13,200 5,657 3,771 2,514 629 629
salary
Reapportionment 177,200 72,154 39,921 24,840 21,581 18,704
Canteen No of employee 9,249 6,166 4,111 1,028 1,028 (19,723)
Maintenance
Maintenance 5,147 3,432 8,579 1,716 (2,744) 858
hours
Canteen No of employee 1,176 784 523 131 131 (989)

Maintenance Maintenance hour 258 172 430 86(217) 43

Canteen No of employee 93 62 41 10 10 (53)

Maintenance Maintenance hour 14 9 23 5 (15) 2

Canteen No of employee 6 4 3 1 1 (3)

Maintenance Maintenance hour 1 1 1 0 0

Total 177,200 15,944 10,630 13,711

b.
i. Compute pre-determined overhead absorption rate (OAR) for each of the production department, assuming Machining
Department uses machine hours, whereas Inspection and Finishing Department use direct labor hours as the basis for overhead
absorption. (Answers are to be rounded up to two decimal places)

(3 marks)

Machining Inspecting Finishing

10,630/1,200= 13,711 / 800=
15,944/2,000=
OAR Department Rate RM8.86 per RM17.14 per
RM7.97 per
Direct Labour Direct Labour
Machine Hour
Hour Hour

ii. Based on your answer in part b(i), compute the amount of over or under absorption of overheads for each department if the
actual data for the month of October 2019 are as follows:

Machining Inspecting Finishing

7.97 x 4,000= 8.86 x 1,600= 17.14 x 600 =

Overhead Absorbed
RM31,880 RM14,176 RM10,284

Overhead Actual RM156,437 RM 63,926 RM 49,558

 RM124,557 RM49,750
Over(Under) Absorb RM 39,274 under
under under