1) Production costs include direct materials, direct labor and manufacturing expenses that constitute a product entity in an industrial enterprise. For example, raw materials directly used in product production and the wages of workers directly produced are directly included in the production cost.

2) Manufacturing expenses refer to the expenses that are consumed in the production workshop and cannot be directly divided into a certain product. Such as: lighting power consumption in production workshop, wages of production managers, welfare expenses, maintenance fees, depreciation of production equipment, etc.

3) Management expenses are all kinds of expenses incurred by the administrative department of the enterprise, which generally include: salary of managers, welfare expenses, telephone charges, office rent and utilities, depreciation expenses of office equipment, travel expenses of managers, etc.

4) Sales expenses refer to various expenses incurred by business departments (such as sales department and after-sales service department) of an enterprise, such as salaries, commissions, travel expenses, telephone charges, entertainment expenses, advertising expenses, depreciation expenses of office equipment, etc.

5) Financial expenses generally refer to the deposit and loan interest, bank charges, sales and purchase discount financing expenses incurred by enterprises.