Prime Cost Consists Of $\begin{array}{llcc} \underline{\text { direct material } }&\underline{ \text { direct labor }} & \underline{ \text {overhead }}\\\end{array}$

question 106

Multiple Choice

Prime cost consists of $\begin{array}{llcc} \underline{\text { direct material } }&\underline{ \text { direct labor }} & \underline{ \text {overhead }}\\\end{array}$

• A) no yes no
• B) yes yes no
• C) yes no yes
• D) no yes yes

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Definitions:

Existing Shareholders

Individuals or entities that currently own shares in a company and have an interest in its performance.

Firm Commitment

A commitment by an underwriter to buy all the unsold shares in an issue and sell them to the public, taking on the full risk of the sale.

Firm Commitment Underwriting

An agreement in which an underwriter commits to buying all the securities offered by the issuer and selling them to investors, taking on the full risk of selling the securities.

Stock Offering

The issuance of new shares by a company to the public or existing shareholders to raise capital.