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QUESTION 1
Limau Manis Sdn Bhd is a medium-sized company that manufactures a variety of pickles in the northern region of Malaysia. In order to complete the production, the pickles must go through Cutting Department and Finishing Department. Cutting Department is machine-oriented, whilst The finishing Department is labor intensive.
There are two service cost centers in the company, namely, Canteen and Maintenance departments. The following is the cost statement provided for the year ended 31 March 2022.
Required:
a. Differentiate between cost apportionment and cost reapportionment.
b. Prepare the overhead analysis sheet which clearly shows the basis of apportionment using repeated distribution method for reapportionment of service departments. (All calculations to be rounded to the nearest RM)
c. Calculate the overhead absorption rate for each of the production departments using an appropriate basis of absorption (in two decimal points). Use the following information when necessary
Below is actual information provided for the year ended 31 March 2022:
d. Determine the over or under absorption of overheads in each production department. (All calculations to be rounded to the nearest RM)
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