The Product Cost System The same cost system was used throughout Nissan’s assembly plants. It reported full product costs that included both direct and indirect expenses. The indirect expenses were traced to the products in two different ways. Direct and indirect manufacturing expenses were directly charged to the production cost center in which they were consumed, and then allocated to the products. Service and administrative expenses and corporate expenses were allocated to the product without first being allocated to a production center. Corporate expenses were equal to about 15% of the sales revenue. They consisted of three major types of expenses: product-related expenses that included advertisements, warranty, and delivery expenses; geographic-related expenses, such as the costs associated with the sales division in Tokyo that supported sales in all three major markets; and finally, there were the expenses associated with corporate administration, legal, and accounting. The product-related portion of corporate expenses was approximately 30% the geographic-related portion 50%, and the other expenses about 20%.