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How Many kind of expenses or Income will come under direct
expenses or Income ?
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Answer Posted / ali imran
All controllable expenses or variable/Marginal expenses are called direct expenses.These expenses increases with activity level so called variable. (i.e more units sold more income derived, More worker hired more wages are paid, Depreciation calculated on units is also direct expense)
All Uncontrollable expenses or fixed expenses are called indirect expenses. These expenses does not increase with activity level so called fixed.( i.e a fixed rate is provided as depreciation is must weather or not new asset is purchased, Subject is rate not amount)
Subject to a reasonable activity level 100% and a particular period of time (i.e 1 year).
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