Transport Costs Represent a Significant Part of the Cost of Products

question 117

True/False

Transport costs represent a significant part of the cost of products that are already valuable relative to their size and weight.

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Definitions:

Prime Costs

The combination of direct material and direct labor expenses incurred in producing a product.

Direct Materials

Raw materials that can be directly traced to the production of finished goods, considered a variable cost and included in the calculation of the cost of goods sold.

Direct Labor

The wages and other compensation paid to employees who are directly involved in the production of goods or services.

Direct Material

Direct material refers to the raw materials that can be directly attributed to the production of goods, essentially part of the finished product.