Direct vs. Indirect Costs

This video defines direct and indirect costs and provides an example to illustrate the difference between direct and indirect costs.-
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[@iriscprice]

Simple and clear. Best explanation I have found on the internet. Thank you for this.

[@Edspira]

+Iris Price Thank you for the kind words!

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[@phillipn.8320]

Something about this delivery style with the black board and the different vibrant color pens is really working for me! So much easier to absorb than someone standing in front of a camera talking.

[@ThatWeirdGuyFromWork]

Just started my MBA coursework, this is profoundly useful.

[@Edspira]

Best of luck!

[@cynthiamartin5402]

Love this, simplified at its best!

[@jessicasimon6648]

I LOVE THIS CHANNEL SO MUCH. GOD BLESS YOU. IM DOING MY CPA COURSE NOW AND YOU EXPLAINED SO MUCH OF THIS STUFF SO WELL TO ME. I HOPE YOU CONTINUE TO MAKE THESE VIDEOS. SO JUST KNOW THAT ALL THESE VIDEOS ARE NOT FUTILE AND THEY'RE SO VERY VERY HELPFUL.

[@syedwaqar9631]

Jessica Simon hello

[@HattieMcDanielonaMoon]

@@syedwaqar9631 Hello

[@OatmealButter]

I like this explanation a lot. Good work, and thank you for breaking this down in layman's terms.

[@MyFinancialFocus]

Economies of scale!

[@davidbanks636]

This is a great video with an awesome example. Thank-you!

[@yakinientertainment6197]

Awesome explanation before i see your video i was confuse but now i clearly understand thanks

[@alexsilin1349]

The best explanation that I have ever seen.

[@stardust_02]

You actually taught me accounting!

[@billclark5055]

You teach this better than professors

[@meriemmosbah8395]

So simple thank you

[@Edspira]

You’re welcome 😊

[@T.K.Do-Jeddah]

fabulous & clear !!

[@cheesybuckets2622]

Nice man, very clear and cohesive

[@alifrahman00]

good ass explanation, respects!

[@rickydolphin]

Great job sir

[@mrkittylovesyou]

Great video!! Thanks!!

[@Edspira]

Thank you for the kind words!

[@erjimsnobe2219]

Thanks for your videos, they are quite easy to understand. Btw, you sound like Seth Rogen.

[@ambitoiusheart]

You are awesome. I like ur way of explanation. Please add more videos

[@Edspira]

Palm Trees,
I currently have 80 videos on managerial accounting on my website:
edspira.com/courses/managerial-accounting
I'm trying to constantly add more videos. Thanks for watching!

[@chrisweber759]

I'm still confused. In the last video we said a cost object is anything that can be assigned a cost. Then we said that an indirect cost cannot be traced to a cost object. Maybe the facotry manager can't be assigned to product 1 or 2, but can't it still be tracable to some other type of cost object?

[@Edspira]

You raise a good point. The cost of a factory manager's salary cannot be traced to any specific product, and thus is as an indirect cost of a product. However, if you are thinking of the factory as a whole as the cost object (or the company as whole) then the factory manager's salary would be clearly traceable to the cost object. The general distinction to keep in mind is that a direct cost is traceable (to the cost object in question, which is often a product) and an indirect cost is not traceable (and thus needs to be allocated).

[@masonzhao2198]

Keep up the good work totally love it

[@boyanvelikov3491]

brilliant!

[@Tabyourfingers]

Can anyone explain how does cost pool comes in between cost and cost object? Does this mean the cost has to be traceable from cost to cost pool to cost object?

[@suvamroy9426]

Why wages of the labors are considered as Direct cost?

[@michaelestrada8262]

Does the guy assembling the car fall under direct labor?

[@takundachokururama6750]

if the firm only made 1 product, would the manager then be a direct cost?

[@PieEater]

goat

[@user-yk4nh5gt6i]

[@9fine]

I need an engineer to explain this.