Which of the following is considered an indirect cost?

An indirect cost is an expense that cannot be directly attributed to a specific product or service. The office manager's salary falls into this category because their work supports the overall operations of the business rather than being tied to a single project or product line. This role typically encompasses tasks such as administrative support, coordination, and management tasks that benefit the entire organization.

In contrast, raw materials, direct labor, and equipment purchases are considered direct costs. Raw materials are expenses directly involved in the production of goods. Direct labor refers specifically to the workers who are directly engaged in manufacturing or creating a product. Equipment purchases are capital expenditures that are utilized in production but can often be assigned directly to specific projects or products as well. Thus, the office manager's salary is a clear example of an indirect cost, as it supports the business operations as a whole rather than any specific output.