Question

Costs that cannot be easily traced to cost-objects in a cost-effective manner are called costs.

Answer 1

Costs that cannot be easily traced to cost objects in a cost-effective manner are called indirect costs.

Costs that are not directly attributable to a cost object are known as indirect costs. Both fixed and variable indirect expenses are possible. Administration, personnel, and security costs are examples of indirect costs.

These are the expenses that aren't directly connected to manufacturing. Indirect costs could include overhead. However, certain overhead expenses are direct costs that can be directly linked to a project.

Indirect costs come in two different forms. One category of indirect costs is called fixed costs, and it includes expenses like temporary road construction and labor transportation that are fixed for a given project or business. The other is recurrent indirect costs which contain actions that repeat for a given company.

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