What is Production overheads?

Indirect production costs that relate not to a single product but to the whole workshop. They are first accumulated in account 2510 and then allocated to accounts 2010 and 2310; the allocation method is set in the accounting policy. Paragraph 128 lists the costs reflected in this account as follows (NAS No. 21, paragraphs 127–129).

• Costs of maintaining and operating machinery and equipment
• Depreciation and amortization of fixed assets and intangible assets relating to production
• Costs of repairing fixed assets relating to production
• Costs of insuring property in production
• Costs of heating, lighting and maintaining production buildings
• Rent for leased buildings, machinery, equipment and other assets used in production
• Wages of staff serving production
• Other costs of a production nature