The total overhead cost is attached as an image with the solution.
What is overhead cost?
- The term "overhead" refers to a company's continuing operating expenses but does not include the direct expenditures involved in producing a good or service.
- Overhead expenses may be fixed, fluctuating, or a combination of the two.
- There are various types of overhead, including administrative overhead, which covers expenses linked to running a business.
- The income statement lists administrative costs.
Overhead costs are recorded on an organization's income statement and have a direct impact on the overall profitability of the enterprise. To calculate net income, commonly known as the bottom line for the corporation, overhead costs must be taken into consideration. Net revenue, often known as the top line for the business, is subtracted from all production-related and overhead costs to determine net profitability.
The total overhead cost is attached as an image with the solution.
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