Cost

We can divide cost it into two types. They are:

• Direct Cost
• Indirect Cost

Direct Cost

Direct cost is thoes cost is thoes cost which directly involved in manufacture and direct activities. for example to product finished goods, we need raw material, warehouses, custom & duties. similary we need management's salary all thoes elements which directly affect to make a product. It is also known as chargeable expenses as they are charged directly to the particular unit of cost concerned of direct expenses are as under:

• Hire of special machinery or equipment for a particular order or product.
• Cost of special layout, designs and drawings. 
• Maintenance cost of such equipment.
• Royalties related with production.

Indirect Cost

Indirect cost is thoes cost which not directly affect the cost but it need to finshed goods. for example we need administrative expenditure. selling and distribution cost. etc which is also indirect affect the production.

So indirect cost also play vital role to finish the product.

The cost which can not be directly absorbed by any goods and services and can not be easily measurable or identified to an unit cost is called indirect cost. It is also called overheads. It includes indirect material cost, indirect labor cost and indirect expenses.

We need both direct as well as indicect cost to make finish goods. after finishing goods we need to warehouse where our product will be safe at their intial position. It means without any damage finished goods will be at warehouse.