Service Cost Center Allocation Worksheet
Maintenance, quality, stores and facilities do not make parts, but their cost belongs in the cost of parts. This worksheet allocates each service cost center to production lines using a driver you choose, so product cost reflects the support each line really uses.
| Service cost center | Allocation driver | Period cost | Total driver units | Driver units, Line A | Driver units, Line B | Cost per driver unit | Allocated to Line A | Allocated to Line B | Unallocated | |
|---|---|---|---|---|---|---|---|---|---|---|
7 | $49,000 | $29,400 | $5,600 | |||||||
40 | $24,000 | $28,000 | $4,000 | |||||||
11.9231 | $33,385 | $23,846 | $4,769 | |||||||
1.5167 | $45,500 | $36,400 | $9,100 | |||||||
33.5714 | $20,143 | $23,500 | $3,357 |
This is a direct allocation: each service cost goes to production lines only, not to other service centers. Total driver units should include every consumer, so the unallocated remainder shows usage outside the two lines. Add columns for more lines if needed in Excel.
Driver data from your ERP
Optional: a short review of pulling allocation drivers from ERP and maintenance data.
Optional. The tool and every export work without this. No spam.
How to use the worksheet
List each service cost center with its period cost. Choose the driver that best explains consumption: machine hours for maintenance, work orders for inspection and planning, receipts for stores, square feet for facilities. Enter the total driver units across the plant and the units used by each production line. The worksheet computes a rate per unit and allocates to each line, then shows what remains unallocated. Export to Excel to feed overhead rates.
Method and formulas
Rate = service cost divided by total driver units. Allocation to a line = rate times that line's driver units. This is the direct method: it ignores services that service centers provide to each other. The step-down or reciprocal methods are more precise, but the direct method is common and usually close enough unless service centers rely heavily on each other. The unallocated remainder is cost for consumers you did not list, such as shipping or administration.
Reading the output
Compare allocated cost per line with revenue or direct labor. A line that looks profitable under a plant-wide rate may be expensive once maintenance and quality are allocated by actual use. A large unallocated remainder means either the driver totals include other consumers or the line list is incomplete. Decide whether to add another line column or to move the remainder to a general overhead pool.
Common mistakes
Using headcount as the driver for everything is easy but rarely tracks cost. Another mistake is changing drivers each month, which makes trends meaningless. Also, check that driver data comes from a reliable source, such as work order counts from the maintenance system or machine hours from shop floor reporting, not estimates. Review the drivers once a year.
Frequently Asked Questions
What is service cost center allocation?
It is the process of assigning the cost of support departments such as maintenance, quality and stores to the production departments or product lines that use them, so product cost includes support activity.
What is the direct method of allocation?
The direct method allocates each service department cost straight to production departments, ignoring services between service departments. It is simple and widely used. Step-down and reciprocal methods add precision when service departments serve each other heavily.
How do I choose an allocation driver?
Choose a measure that moves with the cost: machine hours for maintenance, number of work orders for inspection, receipts for stores. If two drivers fit, pick the one you can measure reliably each period.
What does unallocated cost mean here?
It is the share of service cost used by consumers not listed in the worksheet, such as shipping, administration or other plants. Either add those consumers or assign the remainder to a general overhead pool.
If drivers like machine hours, work orders and receipts are scattered across systems, Netray can help bring them together from your ERP and maintenance data.
Related Tools
Overhead Absorption Rate Setting Worksheet
Build predetermined overhead rates per cost pool, apply them to actual activity and read the under or over absorbed balance.
Costing & FinanceMachine Hour Rate Build-Up Worksheet
Calculate a fully loaded machine hour rate per machine from depreciation, power, maintenance, tooling and floor space.
Costing & FinanceOverhead Under and Over Absorption Calculator
Find under or over absorbed overhead for the period and see how much comes from spending versus volume.
Costing & FinanceStandard Cost Change Approval Memo Template
Record why standard costs are changing, what the inventory revaluation effect is, and who approved the roll.
More Costing & Finance tools
See all- Manufacturing KPI Formula and Definitions Reference
- Manufacturing Cost Variance Types Reference
- Price, Volume and Cost Margin Variance Calculator
- Month End Reporting Readiness Checklist for Manufacturers
- OEE Improvement Value Calculator
- Improve OEE vs Buy a New Machine Calculator
- Six Sigma Project Savings Tracker Worksheet
- Should Cost Model Worksheet for Machined Parts
- Quote Assumptions and Exclusions Template
Keep exploring
Free tools
- SAP Cost Center Assessment Allocation CalculatorSplit a shared cost pool across receiver cost centers by headcount, area or any statistical key figure, and see the rate per unit.
- Overhead Cost Pool Allocation WorksheetSet a predetermined overhead rate for each cost pool and compare absorbed overhead with actual spend.
- SAP B1 Landed Cost Allocation CalculatorSpread shipment charges across the goods by value share to see landed cost per unit and the uplift over invoice price before you post a landed cost document.
ERP fixes and how-tos
- Infor M3 Allocation Table: MITALO Reference and QueriesWhere M3 stores allocations: the MITALO allocation table, how it relates to item balance, query patterns to list allocations and why quantities disagree.
- SYSPRO Landed Cost Tracking: Freight, Duty and AllocationHow landed cost tracking works in SYSPRO: freight and duty, allocation methods, GRN receipts, and the effect on inventory valuation. A practical setup checklist.
- How to Handle Landed Cost and Voucher a PO Receipt in SyteLineAdd freight, duty, and other landed cost charges to a SyteLine PO receipt, allocate them into item cost, then voucher the receipt with a clean 3-way match.
Guides
- SyteLine Shared Services Center ERP Configuration GuideConfigure Infor SyteLine for shared services center operations including centralized AP/AR processing, shared HR functions, and cross-entity service allocation.
- Overhead Allocation Methods in SyteLine: Configuration GuideConfigure overhead allocation methods in Infor SyteLine including fixed, variable, and activity-based approaches. Set up absorption rates by work center and cost pool.
- How to Set Up Co-Products and By-Products in Infor SyteLineStep-by-step guide to configuring co-products and by-products in Infor SyteLine for process manufacturing, including BOM setup, cost allocation, and receipt processing.
AI on your ERP
- Infor M3 Customer Order Management With AI for Status, Allocation and Promise DatesAI for Infor M3 customer order management: answer order status, allocation and delivery date questions from OOHEAD and OOLINE data without exposing it publicly.
- Infor M3 AI for Fashion and Apparel: Seasons, Sizes and AllocationPrivate AI on Infor M3 for fashion and apparel: style-color-size matrix, season planning, allocation, returns and supplier PO tracking, on-prem or private cloud.
Software
- Oracle Field ServiceOracle Field Service schedules, routes and equips mobile workers within Oracle cloud applications. Modules, integrations, AI uses and alternatives.
- Dynamics 365 Field ServiceDynamics 365 Field Service handles work orders, resource scheduling and mobile technicians on Microsoft Dataverse. Modules, integrations and alternatives.