Q.73 Miscellaneous expenses such as office expenses, stationery, postal expenses, etc., falls under
- Aextra expenses
- Badditional expenses
- Csurcharge expenses
- Doverhead expensesCorrect
Solution
Concept
Indirect costs such as office expenses, stationery and postage are called overhead expenses.
Step-by-step solution
1. Office expenses, stationery and postal charges are not used directly in any item of work. 2. They are indirect costs of running the business or project. 3. Indirect costs are called overhead expenses (overheads). 4. So the answer is (D).
Explanation
Some costs cannot be charged to one item of work, like office rent, stationery and postage. These are general or indirect costs and are called overheads. In rate analysis, overheads are usually added as a percentage of the direct cost.
Why the other options are wrong
A: 'Extra expenses' is not a standard costing term for these costs. B: 'Additional expenses' is not a standard term for office and stationery costs. C: Surcharge is an extra levy on a rate or tax, not office expenses.
Shortcut
Office, stationery, postage, establishment costs = overheads.
Common mistake
Confusing overheads with contingencies. Contingencies are for unforeseen items, not routine office costs.
Correct answer: D) overhead expenses