## Re-apportionment of Service Department Overheads
After apportioning overheads to all departments, the costs accumulated in service departments (which do not directly produce goods) must be transferred to production departments because products ultimately pass only through production departments.
This secondary apportionment is called re-apportionment.
### Bases for Common Service Departments
| Service Department | Basis of Re-apportionment |
|---|---|
| Maintenance & Repair shop | Direct labour hours, machine hours, direct wages, or asset value × hours worked |
| Planning & Progress / Tool Room | Asset value × hours worked |
| Canteen & Welfare / Hospital / Personnel Dept | Number of direct workers / employees |
| Time-keeping | No. of cards punched or no. of employees |
| Computer Section | Computer hours or specific allocation |
| Power House (lighting cost) | Floor area, cubic content, no. of electric points, wattage |
| Power House (power cost) | Horsepower, kWh, HP × machine hours, or kWh × machine hours |
| Stores Department | No. of requisitions, weight or value of materials issued |
| Transport Department | Crane hours, truck hours, truck mileage, tonnage, ton-hours |
| Fire Protection | Capital values |
| Inspection | Inspection hours |
### Important Notes
1. Repairs within the repairs shop cost and building maintenance within maintenance shop cost → apportion on capital values.
2. Selection criteria for base: Economy, Practicability, Equitability, and Reliability.
### Methods of Re-apportionment
| Method | Description |
|---|---|
| Direct Re-distribution | Service dept costs distributed only to production depts; inter-service transfers ignored |
| Step Distribution (Non-reciprocal) | Service depts re-apportioned one at a time in sequence; earlier depts not re-charged |
| Reciprocal/Simultaneous Equation | Accounts for mutual services between service departments using simultaneous equations |
| Repeated Distribution | Costs distributed in cycles until residual amounts become negligible |