Select the incorrect statement from the following.

Multiple Choice

• The difference between a direct cost and an indirect cost is that a direct cost relates to a given cost object while an indirect cost does not.

• Actual costs are useful for evaluating managerial performance.

• Actual costs are not relevant in many decisions because actual costs cannot be determined until after the decision has been made.

• When accumulating the cost of a specific cost object, the indirect costs are allocated to the cost object.