Manufacturing overhead referred to as factory overhead, Accounting, Basic Statistics

Manufacturing overhead referred to as factory burden, factory overhead, and manufacturing support costs refers to indirect factory related costs which are incurred when a product is manufactured. Along with these costs such as direct material & direct labor, the cost of manufacturing overhead must be assigned to each unit produced so that Inventory & Cost of Goods Sold are valued & reported according to generally accepted accounting principles (GAAP).Manufacturing overhead involves such things as the electricity used to depreciation on the factory equipment and building; operate the factory equipment, factory supplies & factory personnel. How these costs are assigned or operated to products has an impact on the measurement of an individual product''s profitability
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