Two methods of allocating joint costs to main products are physical measure allocation and market-based allocation. S2: If an intercompany sale of a depreciable asset occurs on the last day of the year and results in a gain to the seller, the asset must be shown on the consolidated balance sheet at its original book value. a. True; False b. False; False c. False; True d. True; True

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Overheads

In cost accounting, overhead refers to those expenses which occur during the operating of a business. Overhead includes the fixed, variable, or semi-variable which is not directly involved with a company product or service. It is very important to analyze overhead expense as it helps the company in determining how much a company must charge for its products and services so that they can generate profit.  Overhead expenses depend upon the nature of the business operations.