Commercial Applications
A cost that is easily traceable to a cost object is known as ……………
- Direct cost
- Indirect cost
- Variable cost
- Fixed cost
Cost
1 Like
Answer
Direct cost
Reason — A direct cost is one which can be easily, directly and wholly related to a particular cost unit or cost centre — that is, it is directly traceable. Examples include direct materials (cloth in dress making), direct labour (wages of machine operator) and direct expenses (hire charges for a specific job). Indirect costs lack this traceability, while fixed/variable classify costs by behaviour, not by traceability.
Answered By
3 Likes
Related Questions
Variable cost per unit increases when ……………
- Volume of production decreases
- Volume of production increases
- Cost of raw material decreases
- Tax decreases
An example of a production overhead would be ……………
- Material
- Rent
- Labour cost
- Supervisory cost
What is a defining feature of semi-variable (mixed) costs?
(1) They remain constant across various activity levels.
(2) They solely consist of variable components.
(3) They only apply to service industries.
(4) They include both fixed and variable elements.
- 1 & 2
- Only 4
- Only 1
- 3 & 4
Fixed cost is a cost which remains same at ……………
- All levels of output
- Even zero level of output
- Both (A) and (B)
- Neither (A) nor (B)