_____ are costs that are incurred as the result of some specific cost object.
A) Direct costs
B) Implicit costs
C) Indirect costs
D) Fixed costs

Question

Quizplus · Accepted Answer

Direct costs are costs that can be directly attributed to a specific cost object, such as a product or service. For example, the cost of raw materials used to manufacture a product is a direct cost of that product. Implicit costs are not actual monetary outflows, but rather the opportunity cost of using a resource for a specific purpose. Indirect costs are costs that cannot be directly attributed to a specific cost object, such as rent or utilities for a factory that produces multiple products. Fixed costs are costs that do not vary with changes in production levels, such as rent or salaries.

_____ Are Costs That Are Incurred as the Result of Some