When Using Normal Costing, the Total Production Cost of a Job

question 57

Multiple Choice

When using normal costing, the total production cost of a job is composed of:

• A) direct material and direct labor, only.
• B) direct material, direct labor, manufacturing overhead, and outlays for selling costs.
• C) direct material, direct labor, manufacturing overhead, and outlays for both selling and administrative costs.
• D) direct material, direct labor, and applied manufacturing overhead.
• E) direct material, direct labor, and actual manufacturing overhead.

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Definitions:

Equivalent Ratio

A proportional relationship between two numbers or quantities, indicating how many times the first number contains the second.

Smallest Term

Smallest Term generally refers to the term in a mathematical expression or sequence with the smallest numerical value.

Ratio

A numerical relationship indicating the number of times one value is contained within or contains the other.

Equivalent Ratio

Ratios that represent the same relationship between two or more quantities, even if their numerals are different.