A cost that can be traced to a cost object. For example, the flour used in baking bread is a direct cost of a bakery’s bread.
The wages and salaries of the employees working exclusively in a manufacturer’s maintenance department are direct costs of the maintenance department. (However, these costs are indirect product costs, since they will need to be allocated to the products manufactured.)
Join PRO or PRO Plus and Get Lifetime Access to Our Premium Materials
Read all 2,651 reviewsFeatures
PRO
PRO Plus
For the past 52 years, Harold Averkamp (CPA, MBA) has
worked as an accounting supervisor, manager, consultant, university instructor, and innovator in teaching accounting online. He is the sole author of all the materials on AccountingCoach.com.
Read 2,651 Testimonials
