In a business there have some indirect cost besides of direct cost. Shut down cost is a well known indirect cost. In different uncertain or certain type of cause a company or any organization may shut down. The all of the activities of the organization may stop. These may be caused by labour strite, uncertain shut down of any machinaries activities or other causes. In this case some indirect cost are arise in the business organization. In managerial decision making process these type of cost of any organization must have to under considered. Suppose a company in a shut down possition the salaries of the management and other employees are a continuous process. These are considered as the cost in accounting. If the sbut down cost of a business organization is take under considerition then the future efficiency of the company increases and it significantly reduces risk of the company.
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