What is the formula for indirect cost rate?

The formula for the indirect cost rate is:

[ \text{Indirect Cost Rate} = \frac{\text{Total Indirect Costs}}{\text{Total Direct Costs}} \times 100 ]

This ratio expresses the indirect costs as a percentage of direct costs, allowing organizations to allocate indirect expenses to specific projects or departments effectively. Indirect costs typically include overhead expenses like utilities, administrative salaries, and rent.