Direct Costs of a Cost Object Are Costs Related to That

question 88

True/False

Direct costs of a cost object are costs related to that cost object that managers and management accountants can trace to it in an economically feasible (cost-effective)way.

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Definitions:

Labor

Refers to the human effort, both physical and mental, used in the production of goods and services.

Output

The amount of goods or services produced by a company, industry, or economy within a certain period.

Revenue

The total income generated by a company or organization from its normal business operations.

Marginal Product

The additional output that is produced by adding one more unit of a specific input, keeping all other inputs constant.