Page 69 - BA2 Integrated Workbook STUDENT 2018

Overhead analysis

Overhead for human resource cost for production cost centre 1:
$16,000
–———— × 25 = $10,000
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All other calculations are done the same way.

Our overhead analysis sheet now looks like this:

Overhead item Basis Prod cost Prod cost Service Total
centre 1 centre 2 cost centre overhead
$ $ $ $
Manager salary Allocation 50,000 55,000 48,000 153,000

Indirect materials Allocation 2,500 12,000 0 14,500
Equipment Allocation 5,700 4,600 0 10,300
maintenance
Electricity Machine 10,000 3,000 0 13,000
hours
Cleaning Floor area 2,500 2,250 250 5,000
Human resources Staff numbers 10,000 3,600 2,400 16,000
–––––– –––––– –––––– –––––––
Total overhead 80,700 80,450 50,650 211,800
–––––– –––––– –––––– –––––––

Illustrations and further practice

Now try TYU 2

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