How Do You Spell OVERHEAD COST?

Pronunciation: [ˌə͡ʊvəhˈɛd kˈɒst] (IPA)

The correct spelling of the term "overhead cost" is /ˌəʊvəˈhɛd kɒst/. The word "overhead" refers to indirect expenses that are incurred by a business during its normal operations, including rent, utilities, and administrative costs. The pronunciation of "overhead" is represented by the phonemes /ˌəʊvəˈhɛd/, with the stress placed on the second syllable. The word "cost" is pronounced as /kɒst/, with the stress placed on the first syllable. Understanding the correct pronunciation and spelling of this term is important for effective communication in business settings.

OVERHEAD COST Meaning and Definition

1. Overhead cost, also known as indirect cost or operating expenses, refers to the ongoing expenses incurred by a company or organization that are not directly attributable to the production or delivery of specific goods or services. These costs are necessary for the overall functioning of a business and are typically incurred regardless of the level of production or sales.

   Examples of overhead costs can include rent or mortgage payments for office or production space, utilities such as electricity and water, insurance, office supplies, salaries of administrative staff, maintenance and repairs, taxes, and depreciation of assets. These costs are not directly tied to the production process or the creation of a specific product or service, but instead contribute to the overall operations of a company.

   Overhead costs are typically accounted for and managed separately from the direct costs of production or service delivery. They are often allocated across different departments or cost centers based on various allocation methods, such as employee headcount, square footage, or revenue generated.

   Managing overhead costs effectively is crucial for businesses to maintain profitability and control expenses. By carefully analyzing and monitoring these costs, businesses can identify opportunities for cost reduction, streamline operations, and make informed decisions to improve overall financial performance.

Common Misspellings for OVERHEAD COST

• iverhead cost
• kverhead cost
• lverhead cost
• pverhead cost
• 0verhead cost
• 9verhead cost
• ocerhead cost
• oberhead cost
• ogerhead cost
• oferhead cost
• ovwrhead cost
• ovsrhead cost
• ovdrhead cost
• ovrrhead cost
• ov4rhead cost
• ov3rhead cost
• oveehead cost
• ovedhead cost
• ovefhead cost
• ovethead cost

Etymology of OVERHEAD COST

The word "overhead" in the context of business and economics comes from the Middle English term "overhed" or "overhede", which meant "above the head" or "over one's head". This term evolved from the Old English word "uforheafod", which had a similar meaning.

The term "overhead cost" refers to the expenses that a business incurs but cannot be directly attributed to specific goods or services. These costs include expenses such as rent, utilities, salaries, and administrative costs. The word "overhead", in this sense, implies that these costs are incurred above or beyond the direct costs associated with producing goods or services.

The concept of overhead costs has been in use since the 19th century, but it became more prevalent and widely recognized in the early 20th century as businesses started to separate and categorize their various expenses.

Plural form of OVERHEAD COST is OVERHEAD COSTS