If you buy $10,000 worth of raw materials to make 1,000 items, it's easy to see you spent $10 on raw materials per widget. Allocating how much management salaries, utilities or rent you spent on each ...

Under Generally Accepted Accounting Principles, or GAAP, manufacturing overhead must be allocated to each item produced. Manufacturing overhead is the expenses associated with the manufacture of ...

Discover how absorption costing is used in GAAP for external reporting. Learn its components and why it's essential for ...

As a former corporate controller and senior vice president of operations, I have experienced both sides of allocated overhead. I have learned manufacturing executives have more control over costs ...

Overhead allocation is a source of great disagreement in our industry. Should the allocation be based on job price? On job cost? Per project? Or per field man-hour. We understand the pros and cons of ...

Will Kenton is an expert on the economy and investing laws and regulations. He previously held senior editorial roles at Investopedia and Kapitall Wire and holds a MA in Economics from The New School ...