Certified Research Administrator Practice Exam

Which of the following is allowable as cost share?

1. Equipment donated at fair market value

2. Alcohol purchased at an allowable business dinner

3. A portion of the salary of the department's Head Secretary

4. Travel costs in excess of the institution's per diem

The correct answer is: Equipment donated at fair market value

Allowable cost sharing refers to contributions that an institution makes to a sponsored project, which can enhance the credibility of the proposed budget and demonstrate institutional support. When considering the provided options, equipment donated at fair market value is permissible as cost share because it represents a tangible asset that can directly benefit the project and have quantifiable value recognized by the sponsoring agency. The fair market value ensures transparency and accountability in how contributions to the project are assessed. Cost share must meet specific criteria, including being verifiable and not included as a cost elsewhere in the project budget. Since equipment can often have a significant impact on project outcomes, this form of cost share is highly valued. In contrast, other options do not align with the requirements for allowable cost sharing: alcohol expenses associated with business dinners often do not meet funding agency guidelines, departmental salaries typically require further justification to qualify as cost share, and travel costs exceeding per diem generally are not accepted as a legitimate cost share due to their non-compliance with set travel policies.