A Cost Center Does Not Directly Generate Revenues

question 187

True/False

A cost center does not directly generate revenues.

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Definitions:

Work In Process

Partially completed goods that are still in the production process at the end of an accounting period.

Conversion Costs

The combination of direct labor and factory overhead costs.

Direct Labor

The workforce directly involved in manufacturing or producing goods, whose wages are considered a variable cost.

Factory Overhead

All indirect costs associated with operating a factory, excluding direct materials and direct labor costs.