What are the different types of fixed overhead costs?

Sometimes they are referred to as fixed overhead costs, fixed overhead costs are business expenses related to the ongoing operation of the company, which tend to remain more or less constant from one billing period to another. The level of production of goods and services created by the company has no impact on the amount of these fixed expenses. In addition, the fluctuations of sales generated in this period also do not change the amount of these obligations. Businesses of any size and type will have some fixed overhead costs, which often relate to costs such as rental or mortgages in the equipment used for operation, various types of insurance plans that protect the company, and even employees who receive a lump sum for salary, rather than wage based on an hourly rate.

One of the more common examples of fixed overhead costs is related to the cost of renting or the cost of the mortgage of the device in which the company operates. In most cases the monthlyThe amount of rent does not change and the mortgage repayment is likely to be uniform. As with all types of fixed expenditure, this type of overhead costs can be planned in the budget and remains the same regardless of what is happening in terms of production or generating the company's income.

The insurance coverage of various types is also part of the fixed cost of most businesses. This includes protection of insurance related to the physical facility itself, coverage that protects business from accidents, and even insurance plans that protect the company from injured by the employees when visiting the place of operation. The cost of this type usually remains the same for most of the insurance year, which makes the budget of these amounts easier.

Another of the Tnni -collections of fixed overhead costs that companies are very likely to experience companies include salaries paid to employees who are not classiflicked as an hourly. Depending on the government regulations that may apply, the salaries of administrative personnel may only be classified in this way. In other settings, all employees are paid to a fixed amount of each pay period that forms part of the total fixed overhead costs, regardless of whether they are classified as administrative employees or not.

It is important to realize that other types of fixed overhead costs can also be subject to the nature of the company's operation. If office equipment is rented at a flat rate per month, it can be classified in this way. Usually, any continuing expenses that remain the same and do not change if shifting in the production or sale of generated companies can be considered a fixed overhead of some type.