Final answer:
Director's Salaries are considered an indirect cost because they cannot be directly attributed to a specific cost object like a product or project; they are instead related to the general management of a company.
Step-by-step explanation:
The question pertains to the classification of costs within a business or accounting context. Specifically, it asks which of the following is considered an indirect cost: a. Wages paid to carpenters, b. Equipment installed, c. Cost of Material, or d. Director's Salaries. An indirect cost is one that cannot be directly traced to a specific cost object, such as a product, project, or department.
In this case, the answer is d. Director's Salaries. this is because director's salaries cannot be directly allocated to the production of a specific product or service, as they are related to the overall management of the company. Unlike direct costs such as wages for carpenters which can be specifically assigned to the construction of a building, or the cost of materials which are used up in the production of specific products, director's salaries are more generalized and benefit the entire organization.