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Small business accountants in Melbourne explain what indirect costs are

Indirect costs are costs that are not directly associated with just one activity but instead multiple, therefore these costs cannot be assigned to specific cost objects. Our small business accountants in Melbourne will explain what indirect costs are.

Considering indirect costs are collection of multiple activities, some examples of specific cost objects include:

– Products, Services, Geographical Regions and Customers

It is useful to identify the indirect costs of your business, so they can be excluded from short-term pricing decisions that are usually above the variable costs of products.

Indirect costs do not vary substantially within certain production volumes and are considered to be fixed costs, some examples of these are:

– Accounting Services
– Admin Salaries
– Rent
– Phone expenses
– Equipment

Getting business accountants to identify these costs will ultimately only benefit you in the long run.

So contact our small business accountants in Melbourne for all your accounting needs!

 
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