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Common Cost Power Maintenance Rent Depreciation Employee's Insurance Supervision Basis of Allocation Electricity, kw Machine hours Area, sq. yd. Asset Value No. of employees No. of employees The company's activities are divided among the various departments in the following proportion: Stores Fabrication 40% 35% Stores Maintenance Assembly 35% 35% Finishing 20% 30% Maintenance 5% Required: Prepare an overhead analysis sheet showing clearly the allocations, apportionments and reapportionments to each cost centre. (12 marks) b) Calculate the appropriate absorption rates for each production departments. (3 marks) Explain why indirect costs cannot be directly traced to cost objects in the same way as direct costs. You may include examples where applicable. (5 marks) (Total: 20 marks) Common Cost Power Maintenance Rent Depreciation Employee's Insurance Supervision Basis of Allocation Electricity, kw Machine hours Area, sq. yd. Asset Value No. of employees No. of employees The company's activities are divided among the various departments in the following proportion: Stores Fabrication 40% 35% Stores Maintenance Assembly 35% 35% Finishing 20% 30% Maintenance 5% Required: Prepare an overhead analysis sheet showing clearly the allocations, apportionments and reapportionments to each cost centre. (12 marks) b) Calculate the appropriate absorption rates for each production departments. (3 marks) Explain why indirect costs cannot be directly traced to cost objects in the same way as direct costs. You may include examples where applicable. (5 marks) (Total: 20 marks)

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