im struggling with re-apportionment using the step down method. Im under the impression that if a non-cost centre provides a service to a cost centre do we apply the whole cost to the cost centre for the services. sorry if that sounds a bit confusing.
What do you mean by a non-cost centre? Do you mean to differentiate between service cost centres and production cost centres?
All the costs of service centres will have to be allocated to production centres eventually. You apportion (divide) the cost based on the service provided.
yes i was a bit confused between cost production cost centres and service cost centres, ive attempted a couple of tasks that are making it clearer, it was the step down apportionment i was having problems with nut have worked out how to calculate.
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any tips john??
If you could be more specific we might be able to help.
im struggling with re-apportionment using the step down method. Im under the impression that if a non-cost centre provides a service to a cost centre do we apply the whole cost to the cost centre for the services. sorry if that sounds a bit confusing.
rob
What do you mean by a non-cost centre? Do you mean to differentiate between service cost centres and production cost centres?
All the costs of service centres will have to be allocated to production centres eventually. You apportion (divide) the cost based on the service provided.
thanks
I hope you will find it helpful.
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