Yes factory rent is direct manufacturing cost because without factory no production can be done so only factory rent is part of direct manufacturing cost and no other rent is included in it.
Office rent is indirect cost as normally all these kinds of offices are used for management purposes which is not directly required for manufacturing of goods that’s why all kind of management costs are indirect costs.
Yes if you rent anything
every company has many costs to running a business from paying bank loans to rent. Costs for a manufacturing company can include:Raw Materialsmaterials such as wood and steel are important to a manufacturing company but these materials are also costly to obtain for the company.Labour Costsany manufacturing company has employees that are hired to help and assist the completion of the specific product or service. these labour costs include paid holiday, overtime and annual wages/salaries.Equipment Costseveryone manufacturing company has equipment that is essentail in the manufacturing process. these can include robots that need to be repaired etc. or equipment within the production line that needs replacing completely e.g. a crane to lift heavy components to specific areas they need to go.
rent & staff wages
What it costs him to do business, such as office rent, pencils, pins,etc material that is not specifically charged out.
Yes factory rent is direct cost because without factory there is no possibility for production of units of goods.
manufacturing overheads include all the expenses made in the factory for the production like depreciation, rent paid for the factory, tools used, supervisior's charge, electricity bill, amount paid for motive power etc. It excludes the prime cost ( direct matl, direct labour, direct expenses)...
Office rent is indirect cost as normally all these kinds of offices are used for management purposes which is not directly required for manufacturing of goods that’s why all kind of management costs are indirect costs.
cost incurred for manufacturing of good and services. It is also called Factory overheads. Example Factory rent,Factory workers salary,other cost which is incurred in factory to manufacture a Product
Direct Expenses are: The direct expenses means those cost incurred directly to the production which are: 1. Workers wages 2. Material Cost 3. Manufacturing Cost 4. Transport 5. Factory Rent 6. Electricity Power 7. Fuel and etc
The cost of the direct materials that can be used to manufacture the table are as follows. These cost are on a per unit basis. Table Top $ 1,700.00 Table Leg $ 500.00 Drawer $ 370.00 Assume a $35 per hour wage rate to the assembly employees. The company uses a job order costing system and applies manufacturing overhead to jobs based on direct labor hours. The company estimates that there will be 12 direct labor hours worked during the month. The estimated manufacturing overhead cost for the month is: a. Factory supervisor salary per month $ 3,500.00 b. Rent for the factory per month $ 1,300.00 c. Depreciation of factory equipment per month $ 600.00 Total Estimated manufacturing overhead $ 5,400.00
Facilities Expenses - Rent, Utilities, Maintenance, InsuranceEquipment Expenses - Maintenance and Repair, DepreciationSelling Expenses such as AdvertisingOperating Expenses such as Telephone, Office Expense and Indirect LaborCosts that add no value to product such as Shipping, Warehousing, and Quality Control
no only factory rent included in foh.simple rent is an operating exp
Yes if you rent anything
A portion of indirect costs factors into your unit cost. For example, let's say you were running a factory. A portion of the factory's square footage is used for administrative tasks, while another portion is used to manufacture your products. The percent of rent and utilities pertaining to the manufacturing would get allocated amongst your units to calculate unit cost.
Direct cost are those costs which varies directly with variation in volume of products units like direct labor or direct material while indirect cost has not direct connection with volume of units of products like depreciation building rent supervisors salary etc.
There's no real science to this, just adding up the numbers. Work out what your costs are other than cost of sales (manufacturing costs). These are things like telephone, postage, stationery, insurance, salaries for non-manufacturing personnel, rent, rates, heat, light and so on.