A company is having three production departments X, Y and Z and two service departments boiler house and pump room. The boiler house has to depend upon the pump room for supply of water and pump room in its turn is dependent on the boiler house for supply of steam power for driving the pump. The expenses incurred by the production departments are: X
Rs.6,00,000; Y – Rs.5,25,000; and Z – Rs.3,75,000. The expenses for boiler house are Rs.1,75,500 and pump room are 2,25,000.
The expenses of the boiler house and pump room are apportioned to the production departments on following basis:
|
|
DEPARTMENT |
Boiler |
Pump |
||
|
|
X |
Y |
Z |
House |
Room |
|
Expenses of boiler house |
20% |
40% |
30% |
10% |
|
|
Expenses of pump room |
40% |
20% |
20% |
20% |
|
Show clearly as to how the expenses of boiler house and pump room would be apportioned to X, Y and Z departments?