Frequently asked questions
What is overhead cost reduction?
Overhead cost reduction is the process of identifying and implementing strategies to decrease the ongoing indirect expenses of running a business, such as rent, utilities, and administrative costs.
Which of the following statements about overhead expenses is true?
Overhead expenses are necessary for the general operation of a business but are not directly tied to the production of goods or services. Examples include rent, utilities, and office supplies.
How to reduce overhead costs in manufacturing?
To reduce overhead costs in manufacturing, businesses can streamline operations, negotiate better rates with suppliers, implement energy-saving measures, and optimize resource allocation.
Benefits
Overhead reduction improves profitability, enhances operational efficiency, frees up resources for investment in growth, and contributes to better financial management.