Overheads

Because the service departments are in the factory and do work for the production departments. Therefore we apportion all factory overheads between all departments, and then reapportion any service department costs on the basis of what work they do for the production departments. Have you watched my free lectures on this? The lectures are a complete free course for Paper F2 and cover everything needed to be able to pass the exam well.

Yeah i have watched ur lectures. My point is that ultimately factory overheads will be charged to production deptts. So why not we charge whole of the factory overheads on first instance to production deptts. Thanx

Because we want to charge the overheads 'fairly'. If a service department does more work for one production than for another department, then it is only 'fair' to charge more of their cost to one department rather than the other.