Question
A manufacturing company produces several different product lines, each with its own unique overhead costs, under this situation, the company can use different methods of
A manufacturing company produces several different product lines, each with its own unique overhead costs, under this situation, the company can use different methods of overhead apportionment to allocate these costs to each product line and determine the profitability of each line. As a management accountant;
a) Explain the various methods that the company can adopt to apportion its overhead costs to different product lines and why.
b) Discuss the factors that the company should consider when apportioning overhead costs
c) Why is overhead apportionment necessary in management accounting?
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