Which of the following is a characteristic of direct costs?

Direct costs are expenses that can be specifically traced to a particular project, product, or department within an organization. These costs are directly associated with the creation or delivery of goods and services and can include things like raw materials, labor costs for workers directly involved in production, and any other expenses that can be directly linked to the project or activity in question.

Being able to assign these costs specifically to a project makes them distinct from other types of costs, such as indirect costs, which cannot be directly linked to a single project or output. This characteristic is crucial for effective budgeting, financial analysis, and project management, allowing organizations to determine the actual cost of a project and the profitability of their services or products.

In contrast, the other options do not accurately describe direct costs: not all direct costs are variable, as some can be fixed if they pertain specifically and exclusively to a project, such as salaries of guaranteed staff members for a project. Additionally, direct costs can be tracked, contrary to what one of the options suggests. Lastly, direct costs encompass both fixed and variable costs, thus eliminating the idea that they only include fixed costs.