Costing by simple division

Last updated: 10.04.2017

Costing by simple division is costing method, or rather approach to costing, under which are indirect costs (overheads) allocated to the product by their division, i.e. by the formula: indirect costs / number of units.

The method is applicable only if a single product is produced.

 

When several types of very similar products are manufactured, it is possible to use for example costing by division using relative numbers.

 

More about other costing methods and approaches here.



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