Overhead

all expenses r not overheads …. there direct manufacturing expenses as well, therefore 1 is wrong.

as for 2, you have probably done those long horrendous exercises which allocate service center costs to production. therefore, 2 is correct

yes.. that is the correct term

reapportion will be the exact answer.

what does the answer say?

ok. thats what i thought. there is this play on english in these questions that u must be able to recognize.

if u note, allocation, apportionment or reapportionment really refer to the same basic concept: that the costs are being divided on to some other object (in this case the production cost centers).

the reason we use 3 different words to refer to the same concept is so that we can identify and differentiate the steps that we take to do proper accounting of overheads

i also had the same problem but as i kept reading and doing more questions. i was able to figure it out.

one example wd be:

John bought a company car. where will this get recorded?

1. expense
2. asset

now, in this question, the correct answer wd be 2. but u can say that
it shd have said Non-current Asset

get it?

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