Page 138 - F2 - MA Integrated Workbook STUDENT 2018-19
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Chapter 7
1.2 Production overheads
The production function is usually divided into a number of departments or cost
centres. Some of these cost centres are directly involved with the production
process. These are called production cost centres.
Other cost centres which are part of the production department are not directly
involved with the production process but provide support services for the production
cost centres. These are called service cost centres.
Fixed production overhead
Production Production Service
cost centre1 cost centre 2 cost centre 1
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