Answer (A) is correct . Direct costs are ones that can be associated with a particular cost object in an economically feasible way, that is, they can be traced to that object. Fixed costs are those that remain unchanged in total over the relevant range of production. A motel manager’s salary is traceable to the single location she manages, and it remains fixed over a set period of time regardless of the number of guests.
Answer (B) is incorrect because Water is a variable cost.
Answer (C) is incorrect because Toilet tissue is a variable cost.
Answer (D) is incorrect because Advertising for the whole chain is not a direct cost of Roberta Johnson’s location.
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