Cost Classification in Manufacturing

Front

Indirect costs include expenses related to administration.

Back

These costs are necessary for the overall management of the business.

Front

Research and development fall under overhead costs.

Back

R&D is crucial for innovation and improving products.

Front

To calculate total direct labour cost, multiply the production time by the hourly cost of each worker.

Back

Total direct labour cost = Production time × Hourly cost of each worker.

Front

Maintenance technicians and cleaners are considered in direct labour costs.

Back

They help maintain the production environment.

Front

The production process's worker number directly impacts production costs.

Back

More workers can lead to higher costs.

Front

Tasks handled by the administration team.

Back

HR, salaries and payroll, IT support, marketing, customer services, research, purchasing, and stock control.

Front

Stock control in manufacturing.

Back

Stock control ensures that inventory levels are maintained efficiently.

Front

Examples of manufacturing overheads.

Back

Manufacturing equipment, manufacturing plant, and general overhead costs.

Front

Factors contributing to overhead costs.

Back

Property taxes, land rent, insurance, electricity, freight, and equipment depreciation.

Front

Financial investment in manufacturing plants.

Back

Setting up plants and equipment is a significant financial investment.