Select the correct statement from the following. The allocation base determines whether a cost is classified as direct or indirect. The same cost cannot be classified as both direct and indirect. Relevant costs can include direct and indirect costs. Direct costs always display a variable behavior pattern. Solution Correct statement is The same cost cannot be classified as both direct and indirect. same cost can be classified as fixed, variable and mixing cost based upon the situation, type and use of cost. But a cost cannot be classified both direct and indirect. For ex: Manufacturing labor costs- DIrect cost this cannot be classified as indirect cost under any circumstances..