ECONOMICS

Detailed explanation-1: -What is a First Stage Allocation? A first stage allocation is the process used to assign overhead costs to activities. This allocation is employed in an activity-based costing system, and is the first step in the eventual allocation of overhead costs to cost objects.

Detailed explanation-2: -Step 1: Identify the products that are the chosen cost objects. Step 2: Identify the direct costs of the products Step 2: Identify the direct costs of the products. Step 3: Select the activities and cost-allocation bases to use for allocating indirect costs to the products for allocating indirect costs to the products.

Detailed explanation-3: -An activity cost pool is an aggregate of all the costs associated with performing a particular business task, such as making a particular product. By pooling all costs incurred in a particular task, it is simpler to get an accurate estimate of the cost of that task.

Detailed explanation-4: -Basic Steps of Cost Allocation Identify shared facilities or support services. Identify the costs to be allocated.