A factory is having three production departments: A, B and C, and two service departments, namely, Boiler House (BH) and Pump Room (PR). The Boiler House is to depend upon the Pump Room for supply of...


A factory is having three production departments: A, B and C, and two service departments, namely, Boiler House (BH) and Pump Room (PR). The Boiler House is to depend upon the Pump Room for supply of water and Pump Room, in turn, is dependent on the Boiler House for supply of power for driving the pump. The expenses incurred by the production departments during a period are: A, `8,00,000; B, `7,00,000; and C, `5,00,000. The expenses for Boiler House are `2,34,000 and the Pump Room are `3,00,000.


The expenses of the Boiler House and Pump Room are apportioned to the production departments on the following basis:


Show clearly as to how the expenses of Boiler House and Pump Room would be apportioned to A, B and C departments. Use algebraic equation method.



Nov 30, 2021
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