Tech Note: Understanding the Manufacturing Overhead Costs

It is crucial for manufacturing companies to properly account for and control production costs, especially overhead costs. To apportion manufacturing overhead costs to their products, the applied overhead cost can be either a fixed amount or a percentage of the direct manufacturing cost. AccountMate supports both methods.

Article #1124: Understanding the Manufacturing Overhead Costs discusses the two methods for apportioning these costs to manufactured products. It also discusses the relevant accounting entries generated in AccountMate and provides some tips on resolving issues that users may encounter when recording overhead costs.