Model: Combination of Labour hour and Machine hour methods
The following information relates to the activities of a production department for a certain period in a factor:
|
Materials used |
36,000 |
|
|
Direct wages |
30,000 |
|
|
Hours of machine operation |
10,000 |
|
|
Labour hours worked |
12,000 |
|
|
Overheads chargeable to the department |
24,000 |
On one order carried out in the department during the period, the relevant data collected were as follows:
|
Materials used |
2,000 |
|
|
Direct wages |
1,650 |
|
|
Labour hours |
825 |
|
|
Machine hours |
600 |
You are required to prepare a comparative statement of cost of this order by using the following three methods of recovery of overheads:
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