Costs that relate specifically to one center and are incurred for the sole benefit of that center are
A) common fixed costs.
B) direct fixed costs.
C) indirect fixed costs.
D) noncontrollable fixed costs.

Question

Quizplus · Accepted Answer

Direct fixed costs are costs that can be traced specifically to a particular center and are incurred for the sole benefit of that center. Common fixed costs (A) benefit more than one center, indirect fixed costs (C) cannot be traced to a specific center, and noncontrollable fixed costs (D) are costs that cannot be controlled by the center manager.

Costs That Relate Specifically to One Center and Are Incurred