Which statement is true?
A)All variable costs are direct costs.
B)Because of a cost-benefit tradeoff, some direct costs may be treated as indirect costs.
C)All fixed costs are indirect costs.
D)All direct costs are variable costs.

Question

Quizplus · Accepted Answer

Direct costs are costs that can be specifically traced to a particular project or product, while indirect costs represent expenses that cannot be tied to a specific project or product. However, in some cases, it may make more sense to treat a direct cost as an indirect cost if the cost-benefit tradeoff is not favorable. The other statements are not true - not all variable costs are direct costs, not all fixed costs are indirect costs, and not all direct costs are variable costs.

Which Statement Is True