what all items are direct expense and what all items are indirect expense ?
Dear Student,
Direct expenses are those costs which are directly related to the principal activities of the business. For example the cost of Raw Material and labor for a manufacturing concern. These are shown on the debit side of Trading Account.
The classification of all the items that are treated as direct expenses is extensively covered in our study material. Please go through the following path.
Select the Subject(Accountancy) --> Study--> Study Material--> Book 2(Financial Accounting Part-II)--> Chapter- 1(Financial Statements-I)--> Lesson-3(Trading Account) Point Number- 3 under the head of Explanation of items recorded in Trading Account.
Indirect expenses are costs that are not related to principal activities of business.The administrative costs for above manufacturing concern will be Indirect costs. These will be shown on the debit side of Profit and Loss Account.
The detailed classification of all the items that are treated as indirect expenses is provided in our study material. Please go through the following path.
Select the Subject(Accountancy) --> Study--> Study Material--> Book 2(Financial Accounting Part-II)--> Chapter- 1(Financial Statements-I)--> Lesson-4(Profit and Loss Account) under the head of Explanation of items recorded in Profit and Loss Account.
Hope this answers your query.
Keep Posting!!!
Direct expenses are those costs which are directly related to the principal activities of the business. For example the cost of Raw Material and labor for a manufacturing concern. These are shown on the debit side of Trading Account.
The classification of all the items that are treated as direct expenses is extensively covered in our study material. Please go through the following path.
Select the Subject(Accountancy) --> Study--> Study Material--> Book 2(Financial Accounting Part-II)--> Chapter- 1(Financial Statements-I)--> Lesson-3(Trading Account) Point Number- 3 under the head of Explanation of items recorded in Trading Account.
Indirect expenses are costs that are not related to principal activities of business.The administrative costs for above manufacturing concern will be Indirect costs. These will be shown on the debit side of Profit and Loss Account.
The detailed classification of all the items that are treated as indirect expenses is provided in our study material. Please go through the following path.
Select the Subject(Accountancy) --> Study--> Study Material--> Book 2(Financial Accounting Part-II)--> Chapter- 1(Financial Statements-I)--> Lesson-4(Profit and Loss Account) under the head of Explanation of items recorded in Profit and Loss Account.
Hope this answers your query.
Keep Posting!!!