Cost accounting looks at the appropriate allocation of overhead and indirect costs that are:

Cost accounting focuses on the systematic allocation of overhead and indirect costs to various cost objects, such as products, departments, or projects, to ensure accurate financial reporting and analysis. The concept of "directly applicable" in this context refers to costs that can be directly associated with a specific cost object, providing a clear link between the incurred costs and the production of goods or services.

Selecting "directly applicable" acknowledges that while overhead and indirect costs are often difficult to trace directly, cost accounting methods are employed to allocate them in a manner that reflects their relationship with the cost objects. This allocation allows for more precise management of costs, budgeting, and financial decision-making.

In contrast, options that suggest the costs are generalized or indirectly applicable either do not align with the need for precise cost allocation required in cost accounting or imply a lack of connection to specific cost objects. The term "unallocatable" suggests that certain costs cannot be assigned to any cost object at all, which undermines the purpose of cost accounting to track and allocate all costs effectively. Therefore, the emphasis on the direct applicability of costs enhances the financial intelligence and accountability within an organization.