An expense that is readily traced to a department because it is incurred for that department's sole benefit is a(n):
A)Common expense.
B)Indirect expense.
C)Direct expense.
D)Administrative expense.
E)Recurring expense.

Question

Quizplus · Accepted Answer

A direct expense is one that can be easily attributed or traced to a specific department or cost center because it is incurred solely for the benefit of that department. Examples of direct expenses include salaries of employees who work exclusively for a particular department, materials used in production for a specific product or department, and rent or lease expenses for a specific area used only by a department. Common expenses are those that are shared by multiple departments, indirect expenses are those that are not easily attributed to a specific department or cost center, administrative expenses are those related to general administration of a business, and recurring expenses are those that regularly occur on a set schedule.

An Expense That Is Readily Traced to a Department Because