Document Type : Review article

Author

• kobra sohrabi

Payam Noor university

Abstract

This article examines the concept of overhead absorption and its role in the management accounting system in an analytical and educational manner. In this article, the overhead absorption process, the principles of indirect cost allocation, the importance of absorption surplus or deficit analysis, and the impact of these issues on determining the cost price of products and the organization's financial decisions are explained in detail. The present article is prepared based on the discussions and points presented in Dr. Heidar Rabiei's class sessions in Costing 1, and an attempt has been made to present the theoretical concepts and practical applications of overhead absorption with clear statements and concrete examples. The purpose of the article is to provide a platform for a better understanding of the overhead absorption mechanism, increase the accuracy of industrial accounting calculations, and support management decision-making in real-world conditions of organizations.

Keywords

• Overhead absorption
• costing
• management accounting
• absorption surplus and deficit analysis
• indirect cost allocation

Main Subjects

• Accounting
• Financial Management