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It is done so to keep control on costs as direct costs are controllable while indirect costs are not.
Answer this question...why do managers cosider direct costs to be more accurate than indirect costs?
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)
cost assignments
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.
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?
They are direct costs.
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)
cost assignments
direct costs,indirect costs,sunk costs, Activity based costing.
If you're referring to income taxes, direct costs are easier to allocate.
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
To calculate indirect costs for a grant application, you can use a predetermined indirect cost rate provided by your organization or calculate it based on your organization's actual indirect costs. This rate is applied to the direct costs of the project to determine the total indirect costs to include in the grant application.
Prime cost = direct materials + direct laborwhile conversion cost = direct labor + factory overhead( which includes indirect materials, indirect labor and other indirect costs
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.