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Is Office and Administrative expenses part of COGS?

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The discussion explores whether office and administrative expenses are part of the Cost of Goods Sold (COGS). While generally considered indirect expenses and not part of COGS in financial accounting (appearing after gross profit), some cost accounting principles, particularly in cost sheets, may include production-related administrative overheads. The distinction often depends on whether one is preparing cost accounts or financial accounts, with different standards and practices applied.

prasad Nilugal

GST Practitioner & Accounts

8996 Points Posted on 05 December 2021

.No , I am taking about litigations .

yasaswi gomes

My grammar is 💯 good I

5110 Points Posted on 05 December 2021

Could be because I once read industries act suggesting all toilets maintenance are indirect expenses. Drinking water probably, cause I dont have time to refresh those acts, while drinking water could fall under direct production costs as directly attributable or indirect costs and fall under admin. Who cares because I am not starting a start up but working in an already existing company. Architecture in all standards will be implemented during inception and most of it is subsequent treatment probably. Lawyers also follow the same standards and I dont understand how they have different measures apart from government acts.