Overhead Charges | Estimation| Learn As Topper

OVERHEAD CHARGES

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Overhead charges of the business cover all the expenditures necessary to carry out the business in addition and also covers the  some special expenditures to run out the business. For examples, Rent of offices and workshops, allowances for wear and tear of the buildings, plant and machinery wages of clerical staffs, general expenditures, rates and taxes, lightning and heating, advertising, insurances, postage and telephone, general traveling expenditure, carriage travelling expenditure, legal cost and bad debts etc. 

Since these charged against anyone contracted however these are spread proportionality against all the jobs may be small and big, during estimation.

NOTE:- For the overhead charges , around 10% to 15% of the true cost is added during the estimation. 

Lets take an example, 

Calculating overhead charges for transporting the cars

Suppose you are the owner of the car manufacturing company where thousands of car manufacture per year and for the selling that cars out of your country then you have to have to pay some extra charges as a tax (according to your country policies). These such charges may be consider in overhead charges.

KEYWORDS:- Overhead charges, electrical estimating, costing, main components of estimating.

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