Which of the following is an example of indirect costs?

Indirect costs refer to expenses that are not directly tied to a specific project or activity but are necessary for the overall operation of the organization. Rent for office space fits this definition as it is a recurring expense that supports the general administrative functions of the business. This cost cannot be attributed directly to a specific project; rather, it is allocated across multiple projects or the entire organization.

In contrast, materials used, labor costs for the project, and equipment purchases are all examples of direct costs. These expenses can be directly linked to a specific project, meaning they are incurred particularly for that project’s execution. Understanding the distinction between direct and indirect costs is essential for budgeting and financial management within surveying and engineering projects, as it helps in accurately pricing services and managing project finances.