Direct cost tracing will accomplish which of the following?
A)identify homogeneous costs
B)classify more costs as indirect
C)focus on the cause-and-effect criterion when choosing allocation bases
D)expand the number of indirect cost pools
E)classify as many of the costs as direct costs, as is economically feasible

Question

Quizplus · Accepted Answer

Direct cost tracing is the process of identifying and assigning direct costs to a specific cost object. The goal is to classify as many costs as possible as direct costs, which can help to increase the accuracy and relevance of cost information. Therefore, the best choice is E, which states that direct cost tracing will classify as many costs as direct costs, as is economically feasible.

Direct Cost Tracing Will Accomplish Which of the Following