Question

Which of the following are not examples of operating costs for an IT investment?

Multiple Choice

• Costs of routine hardware replacements over time

• Cost of contract for help desk support

• Costs of disposal of electronics at end of life

• Costs of software license renewals

• All of the choices are examples of operating costs.

Answer 1

Based on the information available in the question, the correct answer is Option E - All of the choices are examples of operating costs.

Option A - Costs of routine hardware replacements over time would generally be classified as operating costs as it involves general maintenance of the IT investment and the necessary repair expenses related to it. As such, it is a valid operating cost.

Option B - Cost of contract for help desk support is on the lines of the cost of an Annual Maintenance contract required to maintain the help desk facilities and hence a valid Operating cost.

Option C - Costs of disposal of electronics at the end of life are the expenses incurred in respect of the disposal of the electronics at the end of its useful life. This is a valid operating cost.

Option D - Costs of software license renewals are amounts spent at periodic intervals in favor of maintaining the licenses relating to the IT investments. As such, it is a valid operating expense.

Since all the expenses listed above are valid example of operating expenses, the correct answer is Option E which states "All the above".