What is a non traceable cost?

A non-traceable cost, also known as an indirect cost, is an expense that cannot be directly attributed to a specific product, department, or project. Examples include general administrative expenses, utilities, and rent, which benefit multiple areas of a business but lack a clear link to any single output. These costs are typically allocated across various departments or products for accounting purposes. Understanding non-traceable costs is essential for accurate budgeting and financial analysis.