What is 'direct cost' in SAP SRD-FIN-COR - FIN-Cost and Revenue?

direct cost - Overview

• Component: SRD-FIN-COR

• Component Name: FIN-Cost and Revenue

• Description: A cost that can be traced directly to a cost object.

direct cost - Details

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  Key Concepts: 
  Direct cost is a type of cost that can be directly attributed to a specific cost object, such as a product or service. It is also known as a variable cost, as it varies depending on the amount of production or services provided. Examples of direct costs include raw materials, labor, and other costs associated with the production of a product or service. 
  
  How to use it: 
  Direct costs are used in cost accounting to determine the total cost of producing a product or providing a service. They are also used to calculate the profitability of a product or service. Direct costs are typically tracked separately from indirect costs, such as overhead and administrative costs, which are not directly related to the production process. 
  
  Tips & Tricks: 
  When calculating direct costs, it is important to consider all relevant factors, such as labor costs, raw materials, and other associated costs. It is also important to consider any discounts or incentives that may be available for certain products or services. 
  
  Related Information: 
  Direct cost is an important concept in SAP's SRD-FIN-COR FIN-Cost and Revenue Accounting component. This component provides tools for analyzing and managing direct costs, as well as other types of costs associated with producing products and services. It also provides tools for analyzing profitability and making decisions about pricing and production levels.