Costs can be classified into those that are traceable to products and those that are non- traceable. The costs of raw materials that are directly and economically traceable as an integral part of a product, are called:

Question

Quizplus · Accepted Answer

Costs of raw materials that are directly and economically traceable as an integral part of a product are directly related to the production of that product and can be easily identified and traced to that product. Therefore, these costs are classified as direct materials costs.

Costs Can Be Classified into Those That Are Traceable to Products