What Is the Difference Between Administrative and Indirect Costs?

Administrative Costs are those that support the entire organization. Indirect costs are general expenses related to the operation of the overall administration of an organization receiving CNCS funds.

Are administrative costs direct or indirect?

Direct costs are often variable costs, meaning they fluctuate with production levels such as inventory. However, some costs, such as indirect costs are more difficult to assign to a specific product. Examples of indirect costs include depreciation and administrative expenses.

What is the most important difference between direct and indirect administrative costs?

The essential difference between direct costs and indirect costs is that only direct costs can be traced to specific cost objects. A cost object is something for which a cost is compiled, such as a product, service, customer, project, or activity.