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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.

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Q: Is office rent direct cost or indirect cost?
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Explain the difference between direct cost and indirect costs?

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.


What are the differences between direct cost and indirect cost?

Direct compensation is an employee's base wage. It can be an annual salary, hourly wage or any performance-based pay that an employee receives, such as profit-sharing bonuses. Indirect Compensation is far more varied, including everything from legally required public protection programs such as Social Security to health insurance, retirement programs, paid leave, child care or housing.


Factory rent direct manufacturing costs?

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.


Is factory rent direct cost?

Yes factory rent is direct cost because without factory there is no possibility for production of units of goods.


What is the difference between variable overhead cost variance and fixed overhead variance?

direct or indirect cost which increases or decreases with production are variable overheads such as, indirect material, indirect labor, utilities, maintenancd expansis etc. expansis which does not fluctuate with increase or decrease of production called fixed overheads such as rent, salaries, insurance, professional membership like ISO etc.


What are costs that are associated with the operation of manufacturing but are not direct labor or direct materials?

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


What are overheads?

overheads are three indirect elements of cost. The three elements being-i ndirect material, indirect labour and indirect expenses. these indirect elements of cost have no bearing whatsoev er with the level of activity or volume of production. Examples of these indirect elements are- in making shirts. buttons and thread will be indirect material, rent of the factory will be indirect expenses and salary of the storekeeper will be indirect labour these three would be collectively called overheads.


Are sales commissions a direct or indirect expense?

Sales commissions are direct expenses. Direct expenses are those that used to directly run a business like labor, materials products services and more. Indirect expenses are the costs of doing business and include things like rent, insurance, depreciation and more.


What is the difference between production direct and indirect production?

Direct cost are directly linked to the product : materials (cost of raw materials + transfert+associated taxes, ingredients+transport+associated taxes, packaging+transport+associated taxes) and labour (summation of number of hours of work really needed to make a task in the process) + direct expenses (goods purchased for a particular product).Indirect cost for production are splitted into variable and fix.variable production overhead cost are a calculation of a cost per unit you need to product (energy, goods) : energy/unit in $, amortization/unit, ...fix production overhead is tax, rent of the plant, number of hour non used for production, management salaries (for the plant), ...


How much on average does it cost to lease office space?

Its like paying rent, it varies. It will cost different is different states. It also depends on the size of the office.


What are direct and indirect expenses?

Indirect costs are costs that are not directly accountable to a cost object (such as a particular function or product). Indirect costs may be either fixed or variable. Indirect costs include taxes. 1. Salary & Bonus 2. Rent Paid 3. Advertisement & Publicity 4. Electricity Charges 5. Traveling Expenses 6. Telephone Bill 7. Printing & Stationary 8. Postage & Telegram 9. Computer.


How would you describe a common cost?

Common cost ; joint cost ; indirect cost. A cost incurred to benefit more than one product or activity, such as the cost of rent of a factory building in which the firm makes several different kinds of personal computers