Direct Cost and Documentation
There are many differences of opinion and disputes about whether certain costs should be classified as direct or indirect. In addition, the use of ambiguous terms that are used interchangeably doesn't help the situation. For instance, overhead is used interchangeable in industry with burden, loading, add-on, management cost, general and administrative, factory expense, etc. That is why I am always bugging you to document your companies definition of the terms it uses. It helps you, your staff and anyone else who has to deal with the many ways people use these terms. So let's get into the Direct Cost Definition in a bit more detail...
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