Understanding Recoverable and Non-Recoverable Costs in Business Activities

Recoverable means that the cost of the activity can be recovered through the sale of goods or services produced during the activity. For example, if you are hosting a conference and charging attendees for admission, the costs of the conference such as venue rental, speaker fees, and catering can be recovered through the ticket sales.

The recoverable costs are the costs that can be recovered through the sale of goods or services produced during the activity. These costs include venue rental, speaker fees, and catering.

For example, if you are hosting a conference and charging attendees for admission, the costs of the conference such as venue rental, speaker fees, and catering can be recovered through the ticket sales. However, costs such as staff salaries, marketing expenses, and other overhead costs cannot be recovered through the sale of goods or services produced during the activity and are considered non-recoverable costs.