Cost centre expense allocation

What the cost centre expense allocation does

Shared costs hide who really spends what. List each expense with its total and the percentage that belongs to each department, and the workbook checks the percentages add up to 100, works out each department's share in shillings and totals the cost of every department, so you can see which parts of the business pay their way.

Who it is for

Owners and finance managers of businesses with several departments, branches or projects, who need to allocate overheads for management accounts, pricing and budgets.

How to use the workbook

1. Enter each shared expense and its total amount.
2. Type the percentage that belongs to each department; they must add up to 100 percent.
3. Check the percentage check column says OK.
4. Read each department's cost at the top and in the summary.
5. Save a copy under a new name for each month or year, so earlier records stay as they were.

What is inside

• Four cost centres with allocation percentages
• A check that the percentages total 100
• Department share in shillings for every expense
• Department totals at the top
• Summary and chart by department

The workbook has these sheets: Instructions, Allocation. The main table has the columns Expense; Total amount; Admin %; Sales %; Operations %; Other %; Check; Admin. Yellow cells are for you to fill in and grey cells calculate by themselves, so leave the grey cells alone. The example rows show how it works; type over them with your own entries.

Tips for getting it right

• Allocate on a sensible basis, such as floor area for rent and headcount for salaries.
• Use the same allocation every month so trends mean something.
• Review percentages when the business changes.
• Do not allocate costs you cannot explain.

Why keep this record

Accounting records let you answer three questions at any time: what came in, what went out and who owes whom. Kept consistently they also make tax returns, loan applications and the sale of a business much easier, because the evidence is already organised. Entering transactions the day they happen is far cheaper than reconstructing them at year end.

Questions people ask

Do I need to know Excel formulas? No. Type into the yellow cells and the rest is worked out for you. The formulas are visible if you want to see how a figure is reached.

Can I add rows or change the layout? You can add your own columns to the right and your own notes. If you insert rows inside a table, copy the grey formula cells down so the new rows calculate too.

Will it work on my phone or in Google Sheets? Yes for viewing and typing, but dropdown lists and the charts look best in desktop Excel or LibreOffice.

Keeping it safe and up to date

Good accounting records are a legal duty as well as a management tool: keep the supporting receipts and invoices with the workbook, and keep each year's copy for at least five years. Work on a copy, never on your only file, and back it up.

Read how to keep business records for KRA for the wider picture. See more accounting templates or ask us for a custom one.

The workbook works in Microsoft Excel, LibreOffice and Google Sheets. It is a tool to help you work out and record figures, not tax, legal or accounting advice, and it is not affiliated with the Kenya Revenue Authority. If something does not work as described, contact us and we will put it right.

Related guides, calculators and templates

• Guide: How to keep business records for KRA: what to save and for how long
• Guide: Bank reconciliation step by step: match your books to your bank
• Guide: Fixed assets and capital allowances explained for small businesses
• Another template: Balance sheet template
• Another template: Bank reconciliation statement
• Another template: Chart of accounts and general ledger

Need something different? Request a custom template, browse all guides or see every Excel template.