Which of the following is an example of indirect costs?

Indirect costs are expenses that are not directly tied to a specific project or service but are necessary for the overall operation of an organization. In this context, gas is considered an indirect cost because it can be associated with travel or transportation that supports multiple activities rather than a single, identifiable project. It is a cost that contributes to operational efficiency but does not directly relate to patient care or specific supplies needed for medical procedures.

In contrast, medical equipment represents a direct cost as it is specifically required for conducting healthcare services. Salaries typically fall under direct costs when they are for employees directly involved in patient care; however, administrative salaries can also be considered indirect costs. Insurance can be a fixed indirect cost for the organization, contributing to the overall operational expenses.

Understanding the distinction between direct and indirect costs is crucial for budget management in healthcare settings, as it affects financial planning and resource allocation.