Implementation of re-apportionment of overheads, Cost Accounting

Implementation of Re-Apportionment of Overheads

The re-apportionment of service department costs may be implemented in a number of methods.

The Two extremes are as

a) Where costs of each service department are only charged to production centers administration; distribution and selling centers are not charged along with the cost of the service departments are they not production centres.  This is referred to like the Direct Method

Where the reciprocal nature of service costs is totally recognized; which is service departments serve each other. This type of approach may be implemented utilizing two methods as:

i. The repeated distribution method

ii. Utilizing an algebraic approach

b) A compromise method or elimination method may be utilized where with the costs of each service cost centers are reapportioned in turn. The costs of the first service center will be re-apportioned to each user centers involving other service centers. However the first service center is then removed from any further reapportionment. The cost of the second service center involving any costs already reapportioned from the first service center are after that reapportioned to all user centers other than the first service center. The process is continued till all service centers are removed.

Posted Date: 2/5/2013 7:07:03 AM | Location : United States







Related Discussions:- Implementation of re-apportionment of overheads, Assignment Help, Ask Question on Implementation of re-apportionment of overheads, Get Answer, Expert's Help, Implementation of re-apportionment of overheads Discussions

Write discussion on Implementation of re-apportionment of overheads
Your posts are moderated
Related Questions
Financial Statement Issues that are Unique to Manufacturers Different from the retailers, manufacturers have three exclusive inventory category: 1) Raw Materials, 2)Work in

allocate the overheads to the three departments and do the secondary allocation of service departments

the following activities relating to indirect production costs: Activity Activity Costs Cost Drivers Machine Setup $180,000 1,500 setup hours Materials Handling $50,000 12,500 poun

Compute the predetermined overhead rate used during the year in the Preparation and Fabrication Departments.

what is the classification of cost & how it is done?

How does idel capacity effect cost behavior patterns and factory overhead application methods

You want to save $40,000 for a down payment on a new home. You expect to save $7,000 per year, be in the 25% tax bracket and hope to earn 4% on your investments. How long (in mon

Ed Mettway was concerned about his firm''s ability to acquire the necessary property, plant, and equipment to take advantage of steadily increasing sales. Touring Enterprises, esta

Suppose that $4 million is available for investment in three projects.  The probability distribution of the net present value earned from each project depends on how much is invest

Bakers Bagels LLC produces and sells 20 types of bagels by the dozen. Bagels are priced at $6.00 per dozen (or $0.50 each) and cost $.020 per unit to produce. The company is consid