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    MIE Solutions Blog

Job Shop Burden Expenses

Posted by Dave Ferguson on Jun 27, 2012 6:00:28 AM

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.

Topics: solutions, company, costing, erp, Estimating, Founders Blog, inventory management, job costing, job shop software, mrp

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