Direct costs are subject to less uncertainty than indirect costs in a job costing system, but managers still exercise judgment regarding direct cost tracing.

Question

Quizplus · Accepted Answer

While direct costs are more easily traceable to specific jobs or products, there may still be some degree of judgment involved in determining which costs are truly direct costs. For example, should a portion of a supervisor's salary be included as a direct cost for a specific job? This requires some degree of managerial judgment.

Direct Costs Are Subject to Less Uncertainty Than Indirect Costs