For a Manufacturing Company, Which of the Following Is an Example

question 71

Multiple Choice

For a manufacturing company, which of the following is an example of a period rather than a product cost?

• A)Wages of salespersons.
• B)Depreciation of factory equipment.
• C)Wages of machine operators.
• D)Insurance on factory equipment.

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Definitions:

Short-Run Total Cost

The total of all costs incurred in the production of goods or services in the short term, including both fixed and variable costs.

Short-Run Average Cost

The total cost of production (fixed and variable costs) divided by the quantity produced, over the short term where some factors of production are fixed.

Output Quantity

The total amount of goods or services produced by a company or an economy in a specific period.

Marginal Cost

The growth in total expenses incurred from making one more unit of a product or service.