indirect expenses and direct expenses
Answers
Answer:
indirect expenses means like doctor teacher etc
they are giving their service
direct expenses means like shop keeper etc
they selling buying and selling
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Answer:
Explanation:
Direct Expenses
“Direct” as the word suggests are those expenses which are completely related and assigned to the core business operations of a company. They are mainly related to purchases and production of goods/services. Direct expenses are a part of the prime cost or the cost of goods/services sold by a company.
Direct expenses are directly related to the production of the product sold or service rendered, they may differ for different types of companies, such as manufacturing companies, construction companies, service companies, etc.
Examples of Direct Expenses
Wages
Factory rent
Cost of raw material
Premises renting
Fuel
Indirect Expenses
Unlike direct, indirect expenses are not directly related and assigned to the core business operations of a firm. Indirect expenses are necessary to keep the business up and running, but they can’t be directly related to the cost of the core revenue-generating products or services.
Just like direct expenses, indirect expenses can also be different for different types of organisations. These are usually shared costs among different departments/segments within the firm.
Examples of Indirect Expenses
Salaries
Telephone bills
Printing & stationery
Legal & Accounting charges
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