Answer to Question #275598 in Management for Suji

Question

Identify and briefly explain the main types of cost in project management 

Answer 1

Almost every project conducted by a company will involve expenses. In fact, money is typically viewed as one of the three fundamental limitations of every project, along with time and scope. And, with input from the project's other stakeholders, it is up to the project manager to establish how much a project will cost, set a fair budget to assign the right resources, and manage the budget to maximize value and reduce expenditure. The first step in comprehending project management costs is to identify the sorts of expenses that are likely to occur.

They are frequently classified into two types:

Direct costs: They are often one-time expenses incurred by a specific department or the project itself. Fixed labor, materials, and equipment are all examples of direct costs.

Indirect costs: Utilities and quality control are two examples of indirect costs. Incurred by the organization in considerable amounts, indirect expenses occur concurrently with the project but are not always driven by it.