At times, costs cannot be traced to specific units without considerable difficulty or a clerical labour not justified by the result manufacturing overhead represents all costs incurred in the factory over and above direct material cost, and direct labour cost. In other words, it is the aggregate of factory indirect material cost, factory indirect labour cost factory indirect services. The items of overhead, which cannot be identified with specified departments, are prorated or distributed among the related departments and this proration of distribution is technically referred to as apportionment. All items of overhead, which cannot be allocated are apportioned among the production or service departments on some acceptable basis, which is decided after a lot o
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