Indirect costs are described as?

• A. Costs that are easy to allocate to a single product
• B. General costs for running the business not easily assigned to a single product (e.g., marketing, accountant, website)
• C. Direct labor
• D. Costs of raw materials

Answer: (B)

Indirect costs are the general overhead expenses that keep the business running but can’t be traced to a single product. They support multiple products and activities, so they’re allocated across products rather than assigned to one item. Examples include marketing, accounting, website maintenance, utilities, and salaries of non-production staff. This distinguishes them from direct costs, which can be directly tied to a specific product—for instance, the raw materials used to build that product or the direct labor spent producing it. So the description that best fits indirect costs is the general running costs not easily assigned to one product, such as marketing, accounting, and website.