BACHELOR OF BUSINESS ADMINISTRATION

Detailed explanation-1: -Rent and rates are apportioned to different department on the basis of. Explanation: Overheads of the service department are allocated to the production departments based on the floor space occupied by the each departments.

Detailed explanation-2: -Rent and business rates, for example, are sometimes paid by individual cost centres, and floor space is also used as a basis for apportionment to share costs between relevant cost centres. The costs are proportionately assigned to different departments when the overhead belongs to various departments.

Detailed explanation-3: -Floor Area Overheads: such as, rent, rates and taxes on building, building repair and maintenance, lighting, heating and air-conditioning may be apportioned in the ratio of effective floor area of different departments. 8.

Detailed explanation-4: -The basis used for the apportionment of costs between a number of cost centres when the costs are to be shared between them equitably. This occurs when an overhead cannot be directly assigned to one particular cost centre.

Detailed explanation-5: -The total number of workers working in each department is taken as a basis for apportioning overhead expenses amongst departments. Where the expenditure depends more on the number of employees than on wages bill or number of labour hours, this method is used.