Manufacturing
Service Department Cost Allocation (Step-down)
Allocating the cost of the Maintenance department to the Production departments.
| Account Name | Type | Debit ($) | Credit ($) |
|---|---|---|---|
| Overhead: Assembly Dept | Expense (+) | 5,000.00 | - |
| Overhead: Finishing Dept | Expense (+) | 3,000.00 | - |
| Overhead: Maintenance Dept | Expense (-) | - | 8,000.00 |
💡 Accountant's Note
Maintenance doesn't 'make' anything, but its costs must be moved to the departments that actually produce units so they can be included in the product cost.
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