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.
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.