The process of tracing the direct costs and allocation of indirect costs is known as __________?
Correct answer: A. cost assignment
- A. cost assignment
- B. direct assignment
- C. indirect assignment
- D. economic assignment
Explanation
Cost assignment is the broad process of assigning costs to cost objects, including tracing direct costs and allocating indirect costs. Cost allocation alone refers only to assigning indirect costs.
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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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