Cost - Manufacturing Costs VS. Non-manufacturing Costs

Manufacturing Costs VS. Non-manufacturing Costs

Manufacturing Costs are those costs that are directly involved in manufacturing of products. Examples of manufacturing costs include raw materials costs and charges related workers. Manufacturing cost is divided into three broad categories:

1. Direct materials cost.
2. Direct labor cost.
3. Manufacturing overhead cost.

Non-manufacturing Costs are those costs that are not directly incurred to manufacture a product. Examples of such costs are salary of sales personnel and advertising expenses. Generally non-manufacturing costs are further classified into two categories:

1. Selling and distribution Costs.
2. Administrative Costs.