How to Control Overheads

When we study the cost accounting controlling tools, we know the tools for controlling our total cost instead of controlling only overheads. If overheads are increasing, we have to concentrate on control of overheads because without this, we can unable to sell products at competitive rates.





1. To Reduce Carrying Cost 

When we transport our material, we have to pay carrying cost. We can reduce this cost with following ways.

a) Never overload on vehicle. You see often in India, trucks or tempus which are on the roads in accidental position due to overloading. With this, your vehicle repairing cost will increase. Make standard for total loading.

b) If your vehicles are old, sell it and use new vehicle. It will decrease maintenance cost.

c) Proper number of employees should be appointed for carrying the material in vehicles. It should be enough to relax other worker. Otherwise, number of accidents will increase.

2. To Reduce Electricity Cost 

We are seeing that electricity business is going to private hands. So, electricity cost is increasing day by day. We can reduce this cost with following tips.

a) Use lighting bulbs which use low electricity.

b) Use solar energy.

c) Minimum use of ACs.

d) Build plan in such a way that natural light covers whole production plant. Use of transparent fiber sheet can reduce the of lighting in a day.

3. To Reduce the Cost of Indirect Labour 

Office staff's salary is one of important part of overhead. We can reduce the cost not by demotion of employees but with following tips.

a) Make the export to your employees. They will decrease the wastage or do with more productive.

b) Develop the skills of employees for multi-task within small period. With this, we need less employees.

c) Motivate to the employees for telling cost reducing ideas.

4. To Decrease the Cost of Communication 

You can reduce the cost of communication by effective use of online conferencing and emails. With this, you can decrease the number of mobile calls. Less mobile calls means less bill of recharge.

5. Proper Use of Wastage

If you want to learn one thing from Japan, then you can learn the way of using wastage from them. They do not send anything without use. But by efficient and proper use of wastage, they try to decrease the cost of overheads.

 For example

A company who produces ready-made garments. There may be lots of scrap clothes during the production. Company should produce carpets from these scrap clothes. With this, overhead cost will decrease.

6. To Reduce the delay of Material Supply

Create good relationship with supplier. With this, you can get your raw material fastly. Pay the bills of credit on time. It will increase your goodwill in the minds of suppliers.

7. To Use Trend Analysis for Monitor the Overhead Cost 

How can a doctor treat a patient when he do not know what and where is the disease in human body of patient. Like this, without knowing  which overhead cost is increasing, how can we take steps to control them. So, use trend analysis of statistics. If you do not know this, you can learn at here.  

COMMENTS

Comments on this Website
.
Share above Content to Your Friends



Name

access account accountant Accounting accounting definitions accounting ebook Accounting education accounting procedure accounting process outsourcing Accounting Software advance advertising africa Amalgamation amendments announcements Annuity assets audit auditing Australia B.Com. balance sheet bank Bank reconciliation banking basic accounting BBA benefits best bill black money blog bloggers book keeping bookkeeping Branch Accounting - full tutorial budget Budget variance business businessman CA calculator canada capital capital budgeting career cash cash book cash flow statement Chiense children china class coaching coins college commerce commerce students company computer computer accounting conference Contact vinod kumar corporate accounting cost cost accounting cost center cost centre CPA credit credit card cs currency data Debit and credit debit cards debt debtor degree depletion depreciation documents dollar domain Downloads Dubai e-accounting earning education Education Loans email employee EPF ERP euromoney examination excel excise duty expenses facebook factor of loan fans feature fifo FII fiji finacle finance Financial financial accounting fire insurance flickr flow forensic forex formula france fraud free fun function fund GAAP GDP gdr germany gold goodwill goodwill accounting google google apps google apps google base google buzz google calendar Google docs google finance google fusion tables google talk govt. GST guide health Hindi Hindi Language history holding company How to treat FBT in Tally 9 HRA ICAI ICAWI ICICI Bank IFRS income income statement Income Tax India indian railway Indonesia inflation inflation accounting infographics information inspiration insurance insurance accounting interest international Internet Introduction of Tally 9 inventory investment invoice IT Japan Job costing journal entries Kalculate keyboard kindle kuwait laptop law LBT learning lease lecture ledger leducation Leverage Analysis liabilities lifo linkedin loan logical point loss loss of profit M.Com. m.phil malaysia management accounting manual accounting manufacturing account market marketing mastercard material MBA MCA media migration mobile money ms word ms. excel multi currency in tally 9 Multicurrency Accounting mutual fund national security new and sacrifice ratio new york times new zealand news NGO nonprofit-accounting North Georgia Mountains NPV NSE odbc office oman online application online accounting otcei pakistan parents pay pal pdf pie chart pie chart of income pnb podcast ppf presentation price privacy policy prize money prof. vinod kumar profit profit and loss account project management provision purchase puzzles quickbooks Quote quotes quotes of svtuition rating agency ratio analysis RBI readers real estate rectification of errors remote control reports reserves responsibility accounting retirement revenue Revenue reserves review risk rupees salary sale saudi arabia saving sbi scholarship school SEBI security service tax share share trading Shares shri lanka singapore sms social accounting society solution South Africa stock stock exchange structure student students study subsidiary company svtuition swiss bank tally tally 9 Tally 7.2 Tally 9 Tally.ERP 9 tanzania tax Tax Accounting TDS teacher teaching technology test testimonial testimonials thailand tips trading trading on equity transaction trend trial balance tuition twitter UAE UGC - NET Commerce UK United Arab Emirates university usa valuation VAT Video Voucher and vouching wikipedia working capital youtube
false
ltr
item
Accounting Education: How to Control Overheads
How to Control Overheads
http://1.bp.blogspot.com/-SvYTjpYdHtk/UKdpp1agFvI/AAAAAAAAJaM/QbK9gEjyxlA/s400/cut+your+overhead+cost.PNG
http://1.bp.blogspot.com/-SvYTjpYdHtk/UKdpp1agFvI/AAAAAAAAJaM/QbK9gEjyxlA/s72-c/cut+your+overhead+cost.PNG
Accounting Education
http://www.svtuition.org/2012/11/how-to-control-overheads.html
http://www.svtuition.org/
http://www.svtuition.org/
http://www.svtuition.org/2012/11/how-to-control-overheads.html
true
2410664366776677676
UTF-8
Not found any lecture VIEW ALL Readmore Reply Cancel reply Delete By Home PAGES Lectures View All RECOMMENDED FOR YOU Category ARCHIVE SEARCH ALL Lectures Not found any lecture match with your request, please help to write it and send it to our email at vinod@svtuition.org for making this website free accounting and finance encyclopedia. Back Home Sunday Monday Tuesday Wednesday Thursday Friday Saturday Sun Mon Tue Wed Thu Fri Sat January February March April May June July August September October November December Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec just now 1 minute ago $$1$$ minutes ago 1 hour ago $$1$$ hours ago Yesterday $$1$$ days ago $$1$$ weeks ago more than 5 weeks ago Followers Follow THIS CONTENT IS PREMIUM Please share to unlock