graphic of examples of direct and indirect expenses, top view of pens and bills illustration

What are Some Examples of Direct & Indirect Expenses?

In case you forgot, direct expenses can be tracked back to a specific product, service, customer, or project. Indirect expenses, on the other hand, cannot be tracked back to a specific product, service, customer, or project. That all sounds great, right? But, sometimes, it can be tricky to figure out if an expense is direct or indirect. To help, we’re sharing some examples of each.

Examples of Direct Expenses

Remember, every business is different. So, these examples might not all apply to your company.

  • Raw materials
  • Sales commissions
  • Manufacturing supplies
  • Direct labor
  • Customer service
  • Purchase of goods to be sold
  • Transit of goods from the supplier

If you can’t figure out if your expense is a direct expense, ask yourself if you can assign it to a specific product, service, customer, or project. If you can, then it’s a direct expense.

Examples of Indirect Expenses

Like our direct expense examples, some of these indirect expenses will not apply to your company.

  • Salaries
  • Facility insurance
  • Equipment depreciation
  • Equipment maintenance
  • Rent
  • Utilities
  • Office Supplies
  • Advertising
  • Marketing
  • Printing and stationery
  • Legal fees
  • HR costs
  • Health insurance
  • Transit of goods to a customer

If you’re having a hard time assigning an expense to a specific product, service, customer, or project, it’s probably because the expense is an indirect expense.