If you buy $10,000 worth of raw materials to make 1,000 items, it's easy to see you spent $10 on raw materials per widget. Allocating how much management salaries, utilities or rent you spent on each ...

The term "overhead" refers to the costs associated with producing a good or service that are essential but are not directly involved in the production process. For instance, you have to maintain ...

Put simply, overhead costs are any and all costs not directly associated with generating profit for a firm. That is not to say overhead costs are not important or necessary. It is just that, on their ...