Which of the following statements is true of traceability?
A)It uses well-specified economic events as inputs, and its processes follow certain rules and conventions.
B)It is used for investment decisions, stewardship evaluation, activity monitoring, and regulatory measures.
C)It is the ability to assign a cost directly to a cost object in an economically feasible way by means of a causal relationship.
D)It is concerned with determining what activities should be performed by managers and assessing how well they are performed.

Question

Quizplus · Accepted Answer

Traceability refers to the ability to trace costs and revenues to the cost objects that generated them. This involves assigning costs directly to cost objects through a causal relationship, which is economically feasible. Therefore, statement C is true regarding traceability. Statements A, B, and D describe other accounting concepts and processes, but they are not accurate descriptions of traceability.

Which of the Following Statements Is True of Traceability