Everything you need to know about classification of overheads. Classification of overheads refers to the process of grouping costs according to their common characteristics. The overhead costs are incurred not for any particular job, work-order, process or unit but for the business as a whole and include all costs other than direct material costs, direct wages and direct expenses. Overhead [...]
Everything you need to know about the elements of cost in Cost Accounting. A cost is composed of three elements - Material, Labour and Expenses. Each of these three elements can be direct and indirect, i.e., direct materials and indirect materials, direct labour and indirect labour, direct expenses and indirect expenses. In this context the total cost of manufacture is [...]
Examples of cost of production: 1. Sunk Cost and Future Cost 2. Actual Cost 3. Opportunity Cost 4. Explicit Cost 5. Implicit Cost 6. Money Cost and Real Cost 7. Private Cost and Social Cost 8. Selling Cost 9. Overhead Cost. Example # 1. Sunk Cost and Future Cost: Expenditure which has been incurred in past and which cannot be [...]