Indirect costs are allocated to cost objects while direct costs are traced directly via source documentation.

Name: Indirect costs are allocated to cost objects while direct costs are traced directly via source documentation.
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Question

Quizplus · Accepted Answer

Indirect costs cannot be directly traced to a specific cost object and are therefore allocated based on a predetermined overhead rate or method, while direct costs can be directly traced to a specific cost object through invoices, time sheets, or other source documentation.

Indirect Costs Are Allocated to Cost Objects While Direct Costs