Is all overhead fixed?



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Is all overhead fixed?

2 Answer(s)


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The costs that are not directly related to the manufacture of a product or delivery of a service are overheads, they are incurred even if business activity is minimal.

While most overhead costs such as rent, salaries and insurance are typically fixed, overhead costs that increase with higher business activity and decrease with lower business activity are termed as variable overhead.

These usually consist of indirect material, indirect labor and other costs that cannot be directly allocated to a specific product, such as expenses for utilities and equipment maintenance.

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no not all over head are fixed there are certain % the company may fix for the over head just like depreciation which the company has to decide upon in same way the over heads are not fixed there are semi variable and variable over heads which varies from product to product.

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