Solution 15.2

Cost apportionment represents the assignment of a cost to a number of departments or cost centres. Cost apportionment is necessary when ‘shared’ costs of an organization need to be divided among all the departments that incur a benefit from that cost.

Depreciation of equipment	Value of equipment
General managers salary	Sales volume
Head office administration costs	Number of employees
Depreciation of premises	Area / floor space
Rent and rates	Area / floor space
Advertising	Sales revenue
Accounting	Total cost