A direct cost is a cost that is:
A) Does not change with the volume of activity.
B) Identifiable as controllable.
C) Traceable to multiple cost objects.
D) Traceable to a single cost object.
E) Traceable to the company as a whole.

Question

Quizplus · Accepted Answer

Direct costs are costs that can be traced to a single cost object, such as a specific product, department, or project. Examples of direct costs include direct materials, direct labor, and direct expenses. These costs vary with the level of activity and can be easily allocated to a specific cost object.

A Direct Cost Is a Cost That Is