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Are indirect or direct costs easier to allocate?

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2006-11-21 18:38:11
2006-11-21 18:38:11

If you're referring to income taxes, direct costs are easier to allocate.

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It is done so to keep control on costs as direct costs are controllable while indirect costs are not.


No direct costs and indirect costs are not same and opposite of each other.


Answer this question...why do managers cosider direct costs to be more accurate than indirect costs?


Direct Cost are those costs that can be directly assigned to a production process. Indirect cost were those costs that cannot be directly assigned to production process but have to allocate to production. Variable costs are those costs that vary directly with the production level. Only Direct cost could be variable . But not all direct cost are variable. Thus direct cost contains both Variable and Fixed elements while indirect costs contains only fixed element.



Cost that managment can not allocate to direct production or activity.


The Answer is NO. Direct costs are direct cost which can be clearly/economicaly identified with the cost object, indirect costs cannot be traced to a specific cost object, based on the definition direct cos cant be an indirect cost (Misdhaaque Ahmed)


direct costs,indirect costs,sunk costs, Activity based costing.


Direct costs- can be conveniently and economically traced to a cost object Indirect costs- cannot be conveniently or economically traced to a cost object. Instead of being traced, these costs are allocated to a cost object in a rational and systematic manner


Direct cost of sales are those costs that exists as a result of selling the product. Indirect costs are costs that are there whether the product sells or not.


direct costing is a technique in which costs are classified as direct cost or indirect cost.


yes cost function measures the direct costs along with indirect cost.


Direct costs are the ones that can be traced back to specific objects or items. Indirect costs cannot be traced accurately to anything specific.


Prime cost = direct materials + direct laborwhile conversion cost = direct labor + factory overhead( which includes indirect materials, indirect labor and other indirect costs


Direct costs are costs specifically tied to objects, like raw materials or equipment. Indirect costs affect the company as a whole, not attached to an 'object', and include things like advertisement, payroll, and depreciation of equipment.


Companies must separate direct and indirect costs in order to best price their products. If they didn't then products would cost too much for customers.


If you are selling hamburgers, the meat is a direct cost. If the meat was used at a company picnic, it is an indirect cost.


Indirect costs(salaries, materials not directly involved in manufacturing), period costs(selling and admin costs)


Direct costs: Those costs that are linkedto a specific cost objective like product/service. Indirect costs: Those costs that CANNOT be directly linked to a particular cost objective and incurred for multiple cost objectives. Can also be called Common Cost.



Costs assigned to a cost object are either direct or indirect.


prime costs only includes direct cost like direct material and direct labor.


Direct cost are those costs which varies directly with variation in volume of products units like direct labor or direct material while indirect cost has not direct connection with volume of units of products like depreciation building rent supervisors salary etc.


1. The allocative effects of direct taxes are superior to those of indirect taxes. 2. Direct taxes are progressive and they help to reduce inequalities. 3. The administrative costs of direct taxes are more than that of indirect taxes. 4. Direct taxes are more flexible than that of indirect taxes. 5. Indirect taxes are more growth oriented than direct taxes.


is direct cost a? Selling cost, manufacturing costs, direct, manufacturing cost indirect, general and administrative cost, fixed cost , variable cost, is direct cost a? Selling cost, manufacturing costs, direct, manufacturing cost indirect, general and administrative cost, fixed cost , variable cost,



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