Page 146 - F2 - MA Integrated Workbook STUDENT 2018-19
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Chapter 7
3.2 Step-down method
Example 3
Step-down method
A more accurate method is to fully re-apportion the service centre that does
the most work for the other service centre.
The production manager informs us that the 10 maintenance staff eat in the
canteen therefore we should re-apportion canteen first into maintenance and
the production departments. Maintenance should then be re-apportioned only
into the production departments.
The following information is available:
Assembly Finishing Maintenance Canteen Total
Number of staff 20 40 10 – 70
% time spent by 60% 40% – – 100%
maintenance
Complete the table below (to the nearest $):
Basis Assembly Finishing Maintenance Canteen Total
Overhead B Fwd 16,500 26,250 6,675 10,575 60,000
Canteen Number 3,021 6,043 1,511 (10,575)
of staff
Maintenance % time 4,912 3,274 (8,186)
spent
Total 24,433 35,567 60,000
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