Which of the following is an example of a direct cost for a company like Kellogg's that produces several different kinds of cereal?
A) a publicity event in which Kellogg's sponsors a NASCAR automobile
B) point-of-purchase displays for Kellogg's products
C) a series of magazine advertisements for Kellogg's Special K brand cereals
D) the salaries paid to the company's brand managers
E) the Kellogg's plant in Michigan

Question

Quizplus · Accepted Answer

Direct costs are those that can be directly attributed to the production of a specific product. The series of magazine advertisements for Kellogg's Special K brand cereals (C) is a direct cost because it is a marketing expense directly associated with promoting a specific product line.

Which of the Following Is an Example of a Direct