In General,costs Incurred in the Factory That Do Not Qualify

question 69

Multiple Choice

In general,costs incurred in the factory that do not qualify as either direct material or direct labour are called:

• A) manufacturing costs.
• B) manufacturing overhead.
• C) non-manufacturing costs.
• D) selling and administrative costs.

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Definitions:

Interest Expense

The cost incurred by an entity for borrowed funds, reflected on the income statement as a reduction of profits.

Retained Earnings

The accumulated net income that a company decides to keep rather than distribute to shareholders as dividends, often reinvested in the business or used to pay off debt.

Tax-Effect Entry

An accounting entry that reflects the impact of taxes on financial statements.

Interest Revenue

Earnings generated from lending money or through investments in interest-bearing financial instruments.