Allocated overhead charge

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May 1, 2014 at 9:53 am #166994
hasanali95
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Q Proteus
The company has some overhead allocated charges,when an MBO takes place why do we have to omit this overhead ?
Wont the MBO be paying an amount for it?

Thanks in advance
May 1, 2014 at 5:48 pm #167033
John Moffat
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Allocated overheads just means that for profit purposes some of the existing fixed overheads have been charged to this particular project or company.

It does not mean that the amount allocated results in an actual payment by that project/company.
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