Understanding Indirect Project Costs

What are examples of overhead costs in a project?

a. Direct

b. Indirect

c. Variable

d. Fixed

Answer:

Overhead costs such as supervision, administration, consultants, and interest are examples of Indirect project costs.

Costs that are not directly attributable to a cost object are known as indirect costs (such as a particular project, facility, function, or product). Indirect costs can be constant or variable, just like direct costs. Administration, staff, and security expenditures are examples of indirect costs.

These are the expenses that aren't directly connected to manufacturing. Some overhead expenses may be indirect, while some overhead expenses can be immediately linked to a project and are therefore direct costs.

Indirect expenses come in two different forms. One category is the fixed indirect expenses, which are constant for a given project or business and include things like worker transportation to the job site and the construction of makeshift roadways. The other category is comprised of indirect expenditures that are repeated for a specific business, such as maintaining records or paying staff.