Indirect costs are costs that are not directly accountable to a cost object (such as a particular project, facility, function or product). Indirect costs may be either fixed or variable. Indirect costs include administration, personnel and security costs. These are those cost which are not directly related to production. Some indirect costs may be overhead. But some overhead costs can be directly attributed to a project and are direct costs.
There are two types of indirect costs. One are the fixed indirect costs which contains activities or costs that are fixed for a particular project or company like transportation of labor to the working site, building temporary roads, etc. The other are recurring indirect costs which contains activities that repeat for a particular company like maintenance of records or payment of salaries.
Read more about Indirect Costs: Indirect Vs Direct Costs
Famous quotes containing the words indirect and/or costs:
“Imagination is always the fabric of social life and the dynamic of history. The influence of real needs and compulsions, of real interests and materials, is indirect because the crowd is never conscious of it.”
—Simone Weil (1909–1943)
“Pride can go without domestics, without fine clothes, can live in a house with two rooms, can eat potato, purslain, beans, lyed corn, can work on the soil, can travel afoot, can talk with poor men, or sit silent well contented with fine saloons. But vanity costs money, labor, horses, men, women, health and peace, and is still nothing at last; a long way leading nowhere.—Only one drawback; proud people are intolerably selfish, and the vain are gentle and giving.”
—Ralph Waldo Emerson (1803–1882)