Doubt

Yes overhead recovered or charged both are same. It's nothing but as overhead are indirect expenses and such expense that we have incurred can be recovered by charging them to Direct items

Thanusha Lakshmi

CA Final

★ 3K+

05-Sep-22 21:09

Or the amount recovered from the overhead? Because here they have charged this to WIP

Thread Starter

Shankari C

CA Inter

★ 12K+

05-Sep-22 20:27

Overhead rate is a cost allocated to the production of a product or service. Overhead costs are expenses that are not directly tied to production. To allocate overhead costs, an overhead rate is applied to the direct costs tied to production by spreading or allocating the overhead costs based on specific measures like machine hours, direct wages, etc. OH rate = Indirect costs / specific measure

Sudha Reddy

CA Final

★ 20K+

06-Sep-22 11:13

In 4th point.Is it the amount to be charged to WIP Control a/c ? - Yes

Sudha Reddy

CA Final

★ 20K+

06-Sep-22 11:13