Operating Expenses Are

question 63

Multiple Choice

Operating expenses are:

• A) costs that vary directly with production and sales.
• B) the same as cost of goods sold.
• C) the cost of purchasing plant and equipment.
• D) indirect costs of administration and marketing.
• E) inclusive of interest expense.

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Definitions:

Conversion Costs

The combined costs of direct labor and overhead expenses incurred to convert materials into finished goods.

Work in Process

Inventory that includes all materials, labor, and overhead costs for products in the production process but not yet completed.

Lean Manufacturing

A methodology that focuses on minimizing waste within manufacturing systems while simultaneously maximizing productivity.

Cross-Training

Cross-training involves teaching employees the skills and responsibilities of other positions within the organization to increase flexibility and efficiency.