Maths Focus: Cost apportionment

Indirect costs have to be shared (apportioned) between products or departments. In exams, you will be given the costs and enough information to calculate a fair apportionment.

What maths do I need?

You have to calculate usage ratios to apportion costs. So you have to add, divide and multiply.

What do I need to learn?

1 A usage ratio is usage by the department or product divided by total usage.

2 To apportion costs multiply ratio by total cost.

EXAMPLE

A manufacturer makes tables and...

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