Costs can be divided into different categories according to their drivers or behavior. In general, cost classification helps understand the costs by studying their behavior and drivers with the aim of their reduction or optimization. And as in other life situations, it is much easier to influence things by knowing them.
If you know details about your costs, it is then much easier to:
Cost division for sure brings its benefits. But remember that the effort of analysing them costs money (even though only internal) which shall not be higher than the benefits.
SO IN WHICH WAYS YOU CAN ANALYSE YOUR COSTS, I.E. CLASSIFY THEM?
1. According to traceability to cost object (most often product or service):
3. According to relationship with the level of production:
5. According to cost source:
6. According to controllability:
7. According to irreversibility:
8. According to actual existence: