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hey Mr John, i passed my FA thanks to you and now im currently taking MA. Im looking forward for your help once again 🙂
So about overhead absorption rate. First we need to plus the “directly allocation overhead” and “apportioned overhead”, then do re-apportioned and so on…to get absorption rate.
Usually the “apportioned overhead” are like rent. lighting, depreciation of plant etc…
But what about the “directly allocation overhead”?
Does indirect material like lubricant for machine OR indirect labour like supervisor wage consider as “directly allocation overhead”?Congratulations on passing Paper FA 🙂
The total overheads are the total of both the allocated and apportioned overheads.
Allocated overheads are overheads that we know are specifically for a particular department (an example is certainly the cost of the supervisor in a particular department).
Apportioned overheads are those that are not specifically to one particular department but are for the whole factory and need sharing (apportioning) between departments.
I do work through examples of both allocating and apportioning in my free lectures.
yea, i do watched it through. Maybe i missed some of what you talked about. Anyway thanks!
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