Overhead Costs

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Description

Overhead Cost refers to an ongoing expense of operating a business; it is also known as an "operating expense". Examples include rent, gas, electricity, and wages. The term overhead is usually used when grouping expenses that are necessary to the continued functioning of the business but cannot be immediately associated with the products or services being offered (i.e., do not directly generate profits). Closely related accounting concepts are fixed costs and variable costs as well as indirect costs and direct costs.

Concept Prerequisite

Wikipedia Reference

http://en.wikipedia.org/wiki/Overhead (business)

Learning Material

Covered in Topic(s)

 
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