A factory is having three production departments A, B and C and two service departments D and E. Department D has to depend upon E for the supply of water and E in its turn is dependent on D for the supply of power. The expenses incurred by the production departments during a period are A—Rs 8,00,000; B—Rs 7,00,000; and C—Rs 5,00,000. The expenses for D are Rs 2,34,000 and E are Rs 3,00,000. The expenses of departments D and E are apportioned to the production departments on the following basis:
|
Basis |
A |
B |
C |
D |
E |
|
Expenses at D |
20% |
40% |
30% |
10% |
|
|
Expenses at E |
40% |
20% |
20% |
20% |
Show clearly how the expenses of D and E would be apportioned to departments A, B and C using algebraic equations.