Projects often include indirect costs that are necessary to keep the organization running,but are not associated with one specific project.Which of the following items are most typically considered to be indirect costs?
A) costs associated with material and purchased parts
B) the cost of labor provided by project team members, consultants and subcontractors
C) executive salaries, utilities and insurance
D) travel cost for the project team

Question

Projects often include indirect costs that are necessary to keep the organization running,but are not associated with one specific project.Which of the following items are most typically considered to be indirect costs?​ 
A) costs associated with material and purchased parts 
B) the cost of labor provided by project team members, consultants and subcontractors 
C) executive salaries, utilities and insurance 
D) travel cost for the project team

Quizplus · Accepted Answer

Executive salaries, utilities, and insurance are considered indirect costs as they are essential expenses for the organization's overall operation and not directly linked to any specific project.

Options A and D are direct costs as they are specifically associated with a particular project. However, option B is not a clear distinction between direct and indirect costs as labor costs can be considered either direct or indirect depending on the specific circumstances.

Projects Often Include Indirect Costs That Are Necessary to Keep