Direct cost of Typical Costs Incurred on Projects and its behaviors

The direct costs of the project are linked to doing the project work. For instance, this might contain buying software licenses, hiring specialized contractors or payment of the new building. With the increases the production, the direct costs stay the identical in the appropriate range. In case of the software project employees who carry out the overall work, like designers and developers, are to the project direct costs.

Indirect cost of Typical Costs Incurred on Projects and its behaviors

These are the costs that not particularly connected to the operations of project; this is the cost of doing the overall business. For examples lighting, heating, rental office space (if not project have its own offices), shared coffee machine stocking etc.  The project managers are typically indirect cost of project because they not do actual work.

Fixed cost of Typical Costs Incurred on Projects and its behaviors

The fixed costs of the project are everything that is a one-off charge. These fees are not linked to how extended the project goes on. So in case the project manager requires to compensate for once advertising to protect a professional software engineer. For the projects of software development, the space of physical development and computers development in the project are fixed costs.

Variable cost of Typical Costs Incurred on Projects and its behaviors

The variable costs are opposite to the fixed costs - the variable cost of the project change depending on the risk and change management and length of the project. For example, it is costly to pay the salaries of the staff over 1 year project rather than for 6 month.  On the other side if the machine for the project is hire over eight weeks is more expensive as compare with 3 weeks. The overall variable costs for agreed circumstances are equivalent to units grow by variable cost per element. The labor and materials are also included in variable costs.

Sunk cost Typical Costs Incurred on Projects and its behaviors

The sunk costs are said to be the expenses that have previously been incurred. The sunk cost could be fabricated of any other kind of cost on the top but the position is that these costs already happened. The funds have gone. All of these costs are frequently onwards in cases of business, they are necessary to be acquainted with.  It can be said that these stop/continue decisions are frequently depends on the sunk costs. The decision has an impact on a lot of factors, for example infrastructure and skill resources, it must take early as potential in the life-cycle project. Sunk costs are frequently a consequence of not properly gathering requirements of the project.

References Typical Costs Incurred on Projects and its behaviors