Job Shop Burden Expenses

Direct Burden Expenses

The are expenses that are not included in direct labor costs and material costs and these would be direct burden expenses.  Direct costs are those costs directly involved in the manufacturing of a product.  All other direct expenditures can be classified as direct burden expenses.  These would include required fixtures, jigs,molds, etc that have not been included in direct engineering expense.  Normally marketing, sales and shipping expenses would be indirect costs unless they are directed at a specific product.  For example, if you are doing an advertising campaign for a specific product this expense would be an direct burden expense.

Indirect Burden Expense

All expenses except direct expenses are classified as indirect expenses.  This would be administrative expenses, factory overhead expenses.  Factory expenses can include many different items such as indirect material, indirect labor and indirect engineering costs which are not direct costs.   The office or factory rent, utilities, insurance and equipment would all be categorized as indirect burden expenses.

There are many different types of indirect burden expenses which you should probably talk to your account to get a full list which you may be interested in.

MIE Trak ERP software is designed to capture these expenses in order to manage your job costs.

Author: MIE Solutions

David Ferguson has over 20 years of experience in the manufacturing and fabrication industry. David Ferguson has been to over 100 manufacturing companies helping and guiding them to be more efficient and cost effective. As a child in Junior High School David Ferguson found a passion for the early computer systems, which would drive much of his future work. David Ferguson created and sold his first computer program, Arrow Data Systems, which was an early CAD/CAM system for the Apple 2e Computer. In the late 1980's after seeing his father (a sheet metal manufacturer) come home many nights estimating, David Ferguson saw an opportunity to optimize his effort through computer technology. Shortly thereafter the FabriTRAK Production Control package was developed. The Quote It! estimating package was developed out of the FabriTRAK system to become one of the leading sheet metal estimating packages in the world. David Ferguson has always had a passion for developing software to make the manufacturing process simpler, faster and more efficient. Prior to founding MIE Solutions David Ferguson worked with his father at Alco Sheet Metal, METALSOFT Inc. and was a consultant at Toyota Motors Sales. David Ferguson has his Masters in Computer Science and Mathematics from California State University, Long Beach.

1 thought on “Job Shop Burden Expenses”

  1. Hey there! This is my first comment here so I just wanted to give a quick shout out and say I truly enjoy reading your articles. Can you suggest any other blogs/websites/forums that go over the same topics? Thanks a ton!

    Like

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