ABSORB | The World of Accounting For Professional Accountants

1. to assimilate, transfer, or incorporate amounts in an account or a group of accounts in a manner in which the first entity loses its identity and is "absorbed" within the second entity. Examples include the sequential transfer of expenditure account amounts to WORK-IN-PROCESS, finished goods, and COST OF SALES. 2. to distribute or spread costs by the process of proration or allocation. See also ABSORPTION COSTING.