Overheads1

The Overhead concept is used in cost accounting in the same way as the G/L account concept in accounting.
Overheads are used to apply debit balances of G/L accounts to material costs through transfer accounts. The application is performed by recording credits for transfer accounts and debits for finished goods. However, costs should be accumulated on cost centers first to be applied to finished goods.

Information and fields on Overhead records and their relative functions are:
Unit: The unit of the overhead. For instance, kW for electricity expenses.
Transfer Account Code / Overhead Pool: Indicates the account code to which the cost generated on the overhead will be integrated at accounting side, and the overhead pool (if applicable).
Budget Difference Overhead Pool: Indicates the account code and overhead pool (if applicable) to be used to track budget differences occurred in accordance with standards after incurred overhead applications.
Capacity Difference Overhead Pool: Indicates the account code and overhead pool (if applicable) to be used to track capacity differences occurred in accordance with standards after incurred overhead applications.
Efficiency Difference Overhead Pool: Indicates the account code and overhead pool (if applicable) to be used to track efficiency variances occurred in accordance with standards after incurred overhead applications.
The G/L Accounts option located in the right mouse button menu of overhead records is used to specify the G/L account from which the overhead will transfer debit balances. Overheads can call values from multiple accounts; however, a G/L account can be linked only to one overhead.