Determining direct or indirect cost, when determining your home budget such as

Determining direct or indirect cost, when determining your home budget such as: Mortgage, Electric Bill, Home Insurance, Health Insurance, Daycare, Food, Tax preparation and Allowance for children which is Direct or Indirect?

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Expert Solution

Direct expense is an expense incurred that varies directly with changes in the volume of the cost object.A cost object is any item for which you are measuring expenses.

Mortgage - Indirect Expense as it will not vary and is fixed.

Electric Bill - Direct Expense as it will vary depending on usage.

Home Insurance - Direct Expense as it is directly related to home.

Health Insurance- Direct expense as it is directly related to the members of the family,

Daycare- Direct Expense as it will vary on day to day basis.

Food- Direct Expense as it will vary as per consumption.

Tax Preparation-Indirect Expense

Allowance for children-Direct Expense as it will vary depending on the number of children.

ekkarill92 answered 1 year ago

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