Which of the following statements about the direct/indirect cost classification

Question

Which of the following statements about the direct/indirect cost classification is true?

Indirect costs are always allocated.

Indirect costs are always traced.

The direct/indirect classification depends on the cost control measures.

The design of sales target affects the direct/indirect classification.

Indirect costs are always allocated.

Indirect costs are always traced.

The direct/indirect classification depends on the cost control measures.

The design of sales target affects the direct/indirect classification.

Explanation / Answer

Correct Answer is : (c) The direct /Indirect Classification depend on the the cost control measures

Explanation:-

Indirect Cost can not traced at specific activity level due to its used on multiple activies. it's can be identified only on the basis of cost objective and cost connst control measure.

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