Overhead

Overhead costs are relevant for calculating operational costs and thus for determining the sales price of a product.

Definition / explanation

The production of goods is associated with costs for the manufacturer. In order to be able to make a profit, it is therefore of crucial importance for a company to keep the sum of the costs for a product lower than the selling price.

The recording of production costs (calculation) thus forms the basis for price determination.

Direct costs and overheads

In the costing calculation, a distinction is made between direct costs and overhead costs. While direct costs can be assigned to a specific product (e.g. production wages and materials), overhead costs cannot be assigned directly to a product.

These include, for example:

  • Rental costs for the production facility
  • Energy costs
  • Wages and ancillary wages for the administrative employees
  • Costs for maintenance and repair of tools and machines
  • Borrowing costs and taxes

Since the overhead costs are therefore not a specific Payers zuordnen lassen, müssen sie bei der Kalkulation (Kostenträgerrechnung) mittels Verteilerschlüssel (Cost center accounting) zugeordnet werden. Hierbei kommt der Betriebsabrechnungsbogen (BAB) zum Einsatz.

Real and spurious overheads

The overhead costs, in turn, are differentiated between real and fake. The real overhead costs cannot actually be assigned to a single product. The fake ones, on the other hand, can be assigned, but they are not used because this would be cumbersome and therefore time-consuming.

Summary

  • Overheads are production costs that cannot be directly assigned to a product.
  • Calculation forms the basis for price determination
  • Overhead costs require cost center accounting
  • Overhead costs are divided into real and fake
  • Cost center accounting is carried out using an operating accounting sheet
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