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  • Nota de Estudos
  • Rever Tópicos
    BabaJide Martins F.
    TR
    BabaJide Martins F.

    What are the direct expenses? Can anyone explain direct expenses on this topic?

    Morne V.
    ZA
    Morne V.

    Sales of a organization may be the basis for the allocation of expenses, however, the expense has to be directly linked to sales

    Odongo M.
    UG
    Odongo M.

    Accounting -> Direct expenses Direct expenses Allocation of expenses between departments is intended to assist in providing information about the contribution of each department to the earning of profits but this objective will not be achieved unless the allocation provides a good approximation of the true cost involved. Sales may be the basis for the allocation of expenses, however, the expense has to be directly linked to sales. Floor space is another way of allocating expense. However, the following example indicates the problem in using that as a basis for expense allocation. Two departments may have equal floor space yet one department is on the top floor and the other is at ground level. The ground level location has more chance of gaining from passing traffic, people browsing and so on and so would be a more valuable location. Classification is another area for discussion.

    Manish K.
    NP
    Manish K.

    direct expenses occur for buying business items (raw materials) and manufacturing for getting gross profit of an organization. Importantly, sales may be the basis for allocation of expenses.

    Penelope M.
    US
    Penelope M.

    agreed

    Adil N.
    MA
    Adil N.

    What are direct expenses of profit and loss statements?

    Gloria N.
    AE
    Gloria N.

    Allocation of expenses between departments is intended to assist in providing information about the contribution of each department to the earning of profits but this objective will not be achieved unless the allocation provides a good approximation of the true cost involved.

    Epie E.
    TH
    Epie E.

    understood.

    Epie E.
    TH
    Epie E.

    spercifically,what are direct expenses?

    Owusu E.
    GH
    Owusu E.

    Direct expenses enable management to know how each department is contributing to profit.

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