Allocating overhead costs

Related BrainMass Solutions

• Traditional methods of allocating overhead

  473108 Traditional methods of allocating overhead costs Briefly explain how traditional methods of allocating overhead to products might under-allocate costs to low-production volume products.

• What approach to allocating overhead expenses will be more accurate?

  500858 Approach to allocating overhead expenses will be more accurate Some firms pool overhead into a single plantwide overhead pool, while others collect overhead costs into manufacturing departments, each of which has an overhead cost pool and overhead

• Set-Up Company Costing System: analyze current system and recommend changes

  On the other hand, management worries that the current system for allocating overhead costs is misrepresenting the costs of the two products because direct labor costs are not representative of the time spent by each product on the thingamajig.

• How does ABC costing differ from traditional allocation

  Is ABC just a method of allocating overhead costs? If not, discuss. ABC is considered both a way of allocating but also a way of managing.

• Manufacturing Indirect costs. Objective of allocating indirect costs

  In manufacturing environment, which costs are direct and which are indirect in product costing? 3. What is the objective of allocating indirect manufacturing overhead cost of product? 1. What is direct cost?

• Manufacturing overhead costs

  Allocating indirect costs in this fashion assumes that production costs are driven by one underlying factor, rather than several. Activity-based costing (ABC) is a more accurate method of allocating indirect costs to specific products."

• Overhead Allocation Using Different Cost Pools

  How accurate is this method of allocating costs? 5.

• Determing cost driver, computing cost

  Why do you think overhead was over-or under applied during the year? A. What is the appropriate cost driver for allocating overhead to pizzas in Year 1? Cost drivers are activities that cause overhead costs to be incurred.

• Allocating Costs of Support Departments

  The expert examines allocating costs of support departments.

• Overhead allocation

  This is traditional method of allocating the overhead. In case of activity based costing, costs are traced to the activities and then costs are allocated to the cost objects which is more scientific way of allocating the overhead to the product.