The cost, which is related to specific cost object and economically traceable, will be classified as _________?
Correct answer: C. direct cost
- A. line cost
- B. indirect cost
- C. direct cost
- D. staff cost
Explanation
A direct cost can be economically traced to a particular cost object, such as a product, job, or department. An indirect cost cannot be traced conveniently and must be allocated.
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About Cost Accounting
Cost accounting measures and analyses the cost of producing goods or providing services for planning, control and pricing decisions. It covers direct and indirect costs, fixed and variable costs, job and process costing, break-even analysis, marginal costing, overhead allocation, and the difference between product cost and period cost.
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