A cost is considered allowable if it is which of the following?

A cost is considered allowable when it meets specific criteria established by regulations and guidelines governing government contracting. The key components of this definition include being reasonable, allocable, and determined to be allowable.

Reasonableness implies that the cost must be reflective of what a prudent person would incur in a similar situation, meaning it should not be excessive or extravagant. Allocability refers to the necessity for the costs to be directly attributable to the contract, ensuring that they are appropriately charged to the contract in accordance with the benefits received. Lastly, determining whether a cost is allowable involves evaluating it against established procurement rules and regulations, such as those outlined in the Federal Acquisition Regulation (FAR) or the Cost Principles applicable to the type of contract.

The other options mention various attributes of costs, but they do not align with the established criteria for costs to be considered allowable under contracting standards. Beneficial, clear, and documented do not capture the essential attributes needed for regulatory compliance. Similarly, justifiable, predictable, and useful or essential, economical, and accurate do not directly correspond to the specific requirements for classification of costs in contracting. Understanding the primary criteria of reasonableness, allocability, and compliance establishes a solid foundation for evaluating costs in government contracts.