When measuring divisional operating costs,direct versus indirect refers to whether
A)the costs associate directly with the division.
B)the division manager can affect the cost.
C)the costs are fixed.
D)the costs are variable.

Question

Quizplus · Accepted Answer

Direct costs refer to costs that can be directly attributed to the operations of the division, while indirect costs cannot be easily traced to the division's activities. Therefore, when measuring divisional operating costs, direct costs are those that are directly associated with the division. Choices B, C, and D are not accurate definitions of direct versus indirect costs in this context.

When Measuring Divisional Operating Costs,direct Versus Indirect Refers to Whether