Overhead Costs

Overhead costs are the ongoing expenses a business incurs that are not directly tied to producing goods or services. These costs include rent for office space, utilities, salaries of non-production staff, and office supplies. They are essential for running the business but do not vary with production levels. It's important for companies to manage overhead costs effectively, as they can impact overall profitability. Understanding overhead helps businesses price their products or services appropriately, ensuring they cover all expenses and maintain financial health.