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Items Of Manufacturing Overheads Of Crusher Sep 26 2017018332Overhead costs are assigned to products when the products are moved into production To complete this entry a debit is made to WIP and a credit is made to manufacturing overhead The amount of this entry is based upon a predetermined overhead rate determined by the company at the beginning of the fiscal year.
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COST CENTRE: A location function or items of equipment in respect of which cost maybe ascertained and related to cost units for control purpose. 8. COST UNITS: A quantitative unit of product or service in relation to which costs are ascertained. 9. COST APPORTIONMENT: The division of costs among two or more cost centers in proportion to the estimated benefits received, using a proxy, for
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Examples of items included in factory overheads include: Factory expenses (e.g., rent, rates, insurance, water, heat, and electricity) Factory maintenance (e.g., cleaning, servicing, repairs, oiling, and greasing) Depreciation of factory plant and machinery and buildings. Wages and salaries (other than direct labor) of persons engaged in the
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Manufacturing overheads should be classified according to variability i.e. fixed, variable and semi-variable. Management should concentrate attention on those costs which are controllable. Overhead cost per unit can be decreased by increasing the production because fixed and semi-variable manufacturing overhead can be spread over larger volume of output.
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Manufacturing overhead does not include any of the selling or administrative functions of a business. Thus, the costs of such items as corporate salaries, audit and legal fees, and bad debts are not included in manufacturing overhead.
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