Question

What are Direct Expenses? Give any two examples of Direct Expenses.

Hint:

Direct expenses are directly related to the production process and are debited to the Trading Account.

Answer 1

Direct Expenses are costs directly attributable to the production of goods or rendering of services. These expenses are incurred during the manufacturing or trading activities.

Two examples of Direct Expenses:
1. Wages paid for production.
2. Carriage Inwards.