What are Factory Overhead costs?

[IamDozzy]

Factory overhead costs also called manufacturing overhead is the expenses gotten during the manufacturing of a product. It doesn't take into account cost of employing people and cost of buying a material for production to take place. These factory overhead costs are usually factored in when determining the price at which a product would be sold for in the market. Some examples of factory overhead costs include the following;
• Equipment setup costs
• Equipment maintenance costs
• Factory rents
• Factory utility costs
• Factory insurance in the case of accident
These costs are much and as potential business owner or a practicing business owner, it is important for one to know these costs so as to determine how price for goods would be fixed.

 

[Mataracy]

In other word, factory overhead can be defined or describe as the expenses incurred during the production or manufacturing of goods or product.

This is the combination :
. Direct Labour
. Direct material
. Direct expenses
.Priduction overhead.
This is what made up of factory overhead.

 

[Deleted member 28873]

wow really happy I clicked this post have really learnt from this.so it involves all the expenses involved in the production of of a product but its doesn't take into account cost of employing people and cost of buying a material for production to take place.I heard its mostly the combination of Direct Labour
. Direct material
. Direct expenses
.Priduction overhead.like I said I don't really know much on this topic I would do much more research on it.I learnt something today thanks to your post

 

[Olajidey]

Yes, we can also define factory overhead which is also called manufacturing overhead or production overhead as the cost it takes to produce a product excluding the cost of labour and the cost of material for production also the cost at which people are employed. It is also the cost that business as to incur in order to produce its product.