Question

In an essay, explain the different types of overhead costs and the importance of them

Answer 1

Administrative Overhead	As the name suggests, these overheads are not related to the particular function of the organisation nor does it results in activities that generate profits, rather it supports all the other activities of the organisation and administer them. Example include salaries, supplies etc
Manufacturing Overhead	Mfg overheads are those costs that are used in the manufacturing of the products and are required to be allocated to the costing of the units along with direct material and direct labour. Mfg OHs can include depreciation, electricity etc