A factory consists of two production cost centres (G and H) and two service cost centres (J and K). The total overheads
allocated and apportioned to each centre are as follows:
         G          H           J               K
£40,000   £50,000   £30,000   £18,000
The work done by the service cost centres can be represented as follows:
                                                              G       H      J    K
Percentage of service cost centre J to 30%  70%  –    –
Percentage of service cost centre K to 50%  40% 10% –
The company apportions service cost centre costs to production cost centres using a method that fully recognises any
work done by one service cost centre for another.
What are the total overheads for production cost centre G after the reapportionment of all service cost centre
costs?
A £58,000
B £58,540
C £59,000
D £59,540

 

B