Direct costs are costs that can be directly linked to a cost object by physical tracking.

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Direct costs are costs that can be specifically and easily traced to a particular cost object, such as a product or service. These can include materials used, labor costs, and other expenses that are directly related to the production or delivery of a specific product or service. Physical tracking or documentation is often used to link these costs to a specific cost object.

Direct Costs Are Costs That Can Be Directly Linked to a Cost