On allocation of overheads
by Samuel Eilon
International Journal of Manufacturing Technology and Management (IJMTM), Vol. 3, No. 1/2, 2001

Abstract: The allocation of central overheads in a multi-product or multi-market enterprise can have a profound effect on the perceived financial performance of the individual products or markets. The paper describes alternative methods of allocating central overheads and an example is examined where two markets are supplied from two subsidiaries controlled by a central head office but where the subsidiaries have different cost structures from each other. The example serves to illustrate the consequences of overhead allocation methods and the way they can affect managerial efforts to control costs in order to protect sales and maintain a desired level of product/market profitability. This study highlights the need for management to pursue a critical appraisal of accounting conventions for allocating central overheads.

Online publication date: Wed, 02-Jul-2003

The full text of this article is only available to individual subscribers or to users at subscribing institutions.

 
Existing subscribers:
Go to Inderscience Online Journals to access the Full Text of this article.

Pay per view:
If you are not a subscriber and you just want to read the full contents of this article, buy online access here.

Complimentary Subscribers, Editors or Members of the Editorial Board of the International Journal of Manufacturing Technology and Management (IJMTM):
Login with your Inderscience username and password:

Username:        Password:          Forgotten your password?

Want to subscribe?
A subscription gives you complete access to all articles in the current issue, as well as to all articles in the previous three years (where applicable). See our Orders page to subscribe.

If you still need assistance, please email subs@inderscience.com