Allocating expenses is the process of assigning a portion of a company’s total expenses to specific departments or projects. This helps businesses track and manage costs more accurately, informing decisions about budgeting and cost control. By allocating expenses properly, businesses can better understand their financial health, spot potential problems before they become serious, and ensure that everyone involved in a project is held accountable for their costs. It’s an important part of financial management that can help companies reach their goals while keeping their costs in check.