In this article we will discuss about selling and distribution overheads. Selling Overhead: The selling cost refers to the cost of selling function i.e. the cost of activities relating to create and stimulate demand for company's products and to secure orders. The selling costs include the following: (a) Salaries, commissions and travelling expenses to sales staff, (b) Remuneration of sales [...]
The below mentioned article provides a note on administration overhead. According to ICMA Terminology, Administrative overhead is defined as "the sum of those costs of general management and of secretarial accounting and administrative services, which cannot be directly related to the production, marketing, research or development functions of the enterprise." The administration cost is incurred for carrying the administrative function [...]
In this article we will discuss about the arguments for and against inclusion of capital. Arguments in Favour of Inclusion: (a) When wages is the reward of labour, interest is the reward of capital. (b) Interest should either be ignored entirely or else included in respect of all capital employed whether such capital requires the payment of interest or not [...]