What is overhead in terminology?

In terminology, "overhead" refers to the ongoing administrative costs and expenses that are not directly tied to the production of goods or services. This can include expenses like rent, utilities, salaries of non-production staff, and other indirect costs necessary to maintain operations. Overhead is essential for budgeting and financial planning, as it affects the overall profitability of a business. Understanding overhead helps organizations allocate resources efficiently and price their products or services appropriately.