Expenditure that cannot be conveniently traced to a particular cost unit is called:
AOverhead
BDirect cost
CPeriod cost
DSunk cost
Answer & Solution
Correct answer: A. Overhead
1. The defining property of overhead is its inability to be traced directly to a single cost unit.
2. Such costs are pooled and then absorbed using a rational basis.
3. Direct costs, by contrast, are easily traceable to specific outputs.
4. Hence the cost described in the stem is overhead.
_Source: ICAI BoS Inter Paper 3, Ch 4 "Overheads", §4.1 ¶1_
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