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

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Q: Why distinguish direct costs from indirect costs?
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Related questions

Why companies want to distinguish between direct and indirect costs?

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.


What is direct external environment and indirect external environment?

distinguish between direct& indirect environment


Is direct cost same to indirect cost?

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


Why do managers consider direct costs to be more accurate then indirect costs?

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


Why do companies want to distinguish between direct and indirect costs?

I think that it helps them to evaluate business segments on the basis of only those costs directly traceable to each segment.


What is mean of distinguish the indirect object from the direct object?

This is how you can distinguish/recognize the indirect object from the direct object.The indirect object always goes before the direct object. (direct object is bold / indirect subject is italics)I gave Jim the book.The indirect object can be changed into a phrase beginning with to.I gave the book to Jim


Flour for baking bread are direct or indirect cost?

They are direct costs.


Can direct cost be indirect cost?

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)


What are Both traced direct costs and allocated indirect costs?

cost assignments


What are the stages of accounting for costs?

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


Are indirect or direct costs easier to allocate?

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


Direct costs and indirect costs?

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