RedTeam supports 5 main Cost Types for cost tracking:

Your company can choose to use any or all of these Cost Types in your RedTeam Flex database.

Indirect Costs

Indirect costs are costs that are not directly accountable to any particular project, facility, function or product (things accountants generally refer to as cost objectives). In general, Indirect Costs may be either fixed or variable and typically include general management and administrative costs, office, insurance, taxes, and a variety of miscellaneous costs not directly related to one project more than any other. Indirect Costs are generally referred to as Overhead costs for which precise benefits to a specific project are often difficult or impossible to trace. Indirect Costs are those for activities or services that benefit more than one project.

Generally Accepted Accounting Principles (GAAP) and Federal Acquisition Regulations Cost Accounting Standards (FAR/CAS) require that accounting for such costs be done on a rational basis (i.e. allocability) applied consistently over the course of any given accounting period. In other words, an entity's policy for what is considered "direct" versus "indirect" costs should not change within any given reporting period (i.e. consistency).

It is possible to justify the handling of almost any kind of cost as either direct or indirect. Labor costs, for example, can be indirect, as in the case of maintenance personnel and executive officers; or they can be direct, as in the case of project staff members. Similarly, materials such as miscellaneous supplies purchased in bulk (pencils, pens, paper) are typically handled as indirect costs, while materials required for specific projects are charged as direct costs.

Construction

In construction, most cost estimates are broken down into direct costs and indirect costs. Direct Costs are those for activities or services that benefit specific projects, for example salaries for project staff, materials or outsourced services (subcontracts) required for a particular project. Because these activities are easily traced to projects, or procured for a specific project, their costs are usually charged to projects on an item-by-item basis. Indirect Costs are costs which are required for completion of the installation, but are not directly attributable to the cost objective are indirect (i.e. overhead). Overhead should not be confused with General Conditions, which is typically comprised of Direct Costs associated with the management of a particular scope of work.

To update company wide Indirect Cost Allocation Rates, you must be a System Administrator or have the user permissions to access the Configuration menu.

RedTeam supports 5 main Cost Types for cost tracking:

To activate or inactivate any of these Cost Types, you must do so from the Configuration menu, so this action is typically done by your company's RedTeam Flex System Administrator. For assistance configuring Cost Types, contact our Support team via the Chat option in your database.

Note: the Display Order you set for a Cost Type will determine the order in which the Cost Type appears throughout your RedTeam Flex database, for example, the order of the Cost Type columns in your Estimate and Budget.

Steps: