rent and rates are apportioned to different department on the basis of

Subject:
Accountancy
Author:
annabellacharles
Created:
1 year ago

Answers 1

Answer:

Rent and rates are apportioned to different department on the based on floor space

Explanation:

Overheads of the service department are allocated to the production departments based on the floor space occupied by the each departments.

Apportioning of overhead are done using various methods. Namely;

Direct allocation
Direct Labour/ Machine hours
Direct wages
Floor area
Capital
Light points
Machine consumption (Kilowatt hours)

After allocating the overhead to the production department and service departments, overheads of service department are reallocated to the production department. This process is called as apportionment of service department overhead to production department.

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