Which of the following is an indirect expense?

• A. Paying the employee's hours on the project
• B. Paying the office manager salary
• C. Plotter rental
• D. Travel to construction site billed to client

Answer: (B)

Indirect expenses are costs that can’t be traced to a single project and instead support the business as a whole—these are overhead items. The office manager salary fits this category because it isn’t tied to any one project; it keeps the entire office running. In contrast, paying hours to work on a specific project is direct labor charged to that project. Travel to a construction site billed to a client is a direct expense tied to the project’s activities. Plotter rental could be indirect if it serves multiple projects and isn’t easily allocated, but if it’s used for a particular job and can be charged to that job, it becomes a direct expense.