What does $$cost carrier$$ mean in a production environment? The division of overheads amongst the various departments of the factory so that, eventually, a more accurate allocation rate can be established for each department separately. A job or product being manufactured accumulates costs nearing completion, and against which overheads can be allocated according to a predetermined tariff. The cost of a service department allocated to the production departments. The primary allocation where the manufacturing overheads are divided among all the cost centres.