Question

Naveen producing concern is divided into four departments.
‘A’, ‘B’, ‘C’ are production departments and ‘D’ is a service
department. The actual expenses for a period are as follows:
Rs.
Rent 10,000
Repairs to plant 6,000
Depreciation of plant 4,500
Lighting expenses 1,000
Supervisory expenses 15,000
Fire Insurance (on stock) 5,000
Power 9,000
Employer’s liability for insurance 1,500
The following information is available in respect of the four
departments:
Departments
A B C D
Area (Sq. feet) 1,500 1,100 900 500
Number of lights 75 11 9 5
Number of
employees 200 150 100 50
Total wages (Rs.) 60,000 40,000 30,000 20,000
Value of plant (Rs.) 2,40,000 1,80,000 1,20,000 60,000
Value of stock (Rs.) 1,50,000 90,000 60,000 -
Apportion the costs to the various departments on the most
equitable method.

Answer 1

Answer:

2 (C): Classify the Accounts into Assets, Liabilities, Income, Expenditure and Capital (3M)

(1) Goods A/C

(2) Wages A/C

(3) Loan A/C

(4) Debtors A/C

(5) Creditors A/C

(6) Furniture A/C

(7) Bills Receivable A/C (8) Meena's Capital A/c (9) Drawing A/C

(10) Discount A/C

(11) Rent Received A/c (12) Building A/C

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