Administrative Costs Are

question 75

Multiple Choice

Administrative costs are:

• A)The costs of establishing and maintaining a large number of contracts
• B)The costs incurred by a firm conducting activities in-house
• C)The costs incurred by all administrative functions
• D)The fixed costs incurred by the firm

---

Definitions:

Equivalent Units

A concept in cost accounting used to allocate costs to partially completed units of production, making them comparable to fully completed units.

Conversion Costs

The sum of direct labor costs and manufacturing overhead costs incurred to convert raw materials into finished goods.

Completion Ratios

A measure used to evaluate the extent to which a task, project, or goal has been completed, often expressed as a percentage.

Direct Materials

Raw materials that are directly traceable and allocable to the production of specific goods or services.