Costs in Relation to Manufacturing Departments or other segments
A business can be divided into segments having any of a variety of names. The division of a factory into department, processes, work cells, cost centers, or cost pools also serves as the basis for classifying and accumulating costs and assigning responsibility for cost control. As a product passes through a department or cost center, it is charged with directly traceable costs (typically direct materials and direct labor ) and a share of indirect costs (factory overhead).